If you’re looking into Chapter 7 bankruptcy or Chapter 13 Bankruptcy, you may come across information regarding the bankruptcy means test calculations.
If you’re looking into Chapter 7 bankruptcy or Chapter 13 Bankruptcy, you may come across information regarding the bankruptcy means test calculations.
The bankruptcy means test which can be quite confusing when you visit the government website, so a Chapter 7 or Chapter 13 calculator can help you in your endevour. The big question is whether you meet the eligibility requirements for Chapter 7 bankruptcy using the means test.
But fret not, because you have options! Below you have access to Chapter 7 means test calculatorand Chapter 13 calculators based on the latest bankruptcy forms. It can help you estimate both your Chapter 7 qualification and the overall cost involved, all in one go.
Let’s get started
How A Chapter 7 Means Test Calculator Works
A Chapter 7 means test calculator helps you estimate the Chapter 7 bankruptcy qualification. If you are below the government stated means test income based on household size and income in your state, you may qualify for Chapter 7 bankruptcy.
The Chapter 7 bankruptcy means test is a tool that uses your gross income (income before taxes) to determine your eligibility for filing Chapter 7 bankruptcy. The means test has two parts: the first part assesses whether you may qualify based on IRS allowed expenses, while the second part uses your actual expenses.
To help you with this process, we’ve created a Chapter 7 Means Test Calculator that follows the official protocol used by US Bankruptcy Forms. The means test calculator uses the Chapter 7 Statement of Your Current Monthly Income (Form Number: B 122A-1) to calculate your Chapter 7 means test, while the above-median calculator employs the Chapter 7 Means Test Calculation (Form Number: B 122A-2) to assess whether you qualify above the median income.
The bankruptcy means test calculator is an estimate and your actual results may vary. Nonetheless, it provides a good indication of whether you appear to qualify for Chapter 7 bankruptcy in your state.
How A Chapter 13 Calculator Work
If you’re considering filing for Chapter 13 bankruptcy, you may benefit from using a Chapter 13 calculator to estimate your wage earner’s plan for either 3 or 5 years. This type of bankruptcy is designed for those with a regular income who can pay off some of their debt through a Chapter 13 repayment plan.
In order to determine how much you can repay each month, the bankruptcy court will assess your disposable income. Our Chapter 13 calculator mirrors the disposable income bankruptcy form used to calculate your Chapter 13 plan payment. It will give you a good idea of what your disposable income is and help you estimate your monthly payments throughout the 3 or 5 year plan.
Understanding Chapter 13 Bankruptcy
When filing for bankruptcy, the court expects you to repay your creditors as much as possible. However, if you’re unable to do so, the court will ensure that you only pay the minimum plan payment. To assess your ability to repay, the court uses three common forms for Chapter 13 bankruptcy.
The first form is the Chapter 13 Calculation of Your Disposable Income, which determines whether you have enough disposable income to pay non-priority unsecured creditors. This document uses IRS standards and location guidelines to evaluate your income and expenses.
The remaining two forms are Schedule I: Your Income (for individuals) and Schedule J: Your Expenses. These forms allow you to report your actual expenses. It’s essential to enter accurate numbers since you may be required to produce documents to verify your claims.
If you have assets with equity that exceeds the state homestead exemptions, you may be required to pay some amount in your plan payment. States have varying exemptions for what property or items are protected from bankruptcy, and the amounts of the exemption also vary. Assets that may be affected include jet skis, vacation homes, and more. Even if you qualify for a Chapter 7, you may consider a Chapter 13 if you have significant value in these assets due to the implications of a Chapter 7 liquidation bankruptcy.
Summing It All Up
Filing for bankruptcy is ultimately your decision and you understand your finances. Hopefully a Chapter 7 calculator or a Chapter 13 calculator can help you understand the bankruptcy options, the costs, and pros and cons to help you weigh the pros and cons of your options.