Means Test: Not As Bad As You Think

               It is no secret that the reason I blog about Chapter 7 and Chapter 13 bankruptcy in Indiana is because people considering bankruptcy rely on the internet for preliminary information on bankruptcy.  Lets face it.  No one really wants to ask all of their friends if they know what happens during bankruptcy or if they know a local bankruptcy attorney.  It is typically something that people want to keep to themselves.  As a result, it seems like people spend hours combing the internet reading about bankruptcy.

               As a warning, there is certainly a lot written about bankruptcy on the internet that is not true.  But more commonly, a person who is not an attorney may not correctly understand something written on the internet about bankruptcy OR that fact may not apply in each and every case.  Sure.....it is easy to get online and see what the bankruptcy forms look like or even print them out.  It is also super easy to fill out the forms.  BUT ARE YOU FILLING OUT THE FORMS CORRECTLY?  Did you take your proper exemptions?  Do you know if there is anything you did prior to filing bankruptcy that might be a problem for your bankruptcy?  As a comparison, I could easily print off all of the tax forms that I think I need from the IRS and IDR websites.  Heck, I could also fill them out pretty fast.  But I don't.  I have an accountant do my taxes because I am 95% sure that if I completed my own tax forms and sent them off to the IRS that I would be hearing from the IRS at some point down the road to pay up due to my mistakes.

               Nonetheless, I can always tell when someone contacts me for an appointment when they have been doing internet research.  Typically the caller will mention something about the means test during the call and whether they believe they will fall above or below the average household income.  Many potential clients are very worried that they will not be able to qualify for a Chapter 7 bankruptcy simply because they fall above the average.

              But, what I always tell them is that is a preliminary determination that you do not qualify for a Chapter 7.....not a final decision.  The means test presumption of abuse can be rebutted through the means test calculation.  Many of the deductions allowed on the means test are specific to your family and what you actually spend.  Therefore, depending on the types of debts and expenses that your family has, there is a possibility that you can still qualify for a Chapter 7.  Frankly there are a few lesser known deductions such as a deduction for an older vehicle with high mileage that a bankruptcy attorney will know you can deduct, but you probably would not have known about.  In addition, you can deduct what you actually spend on medical expenses in an average month.  These are just a few examples.  I have filed many Chapter 7 bankruptcies that were successfully discharged where the debtors made more than the average household size and overcame that preliminary presumption of abuse.  Sure, it is possible that you will not qualify for a Chapter 7 due to your income.  However, no one should simply assume he or she cannot qualify for a Chapter 7 simply because their household income is above average.  As always, feel free to call Halcomb Singler at (317) 575-8222 if you are contemplating bankruptcy and would like me to review your situation and answer your questions regarding bankruptcy.  There is no fee for a bankruptcy consultation.


Halcomb Singler, LLP, is a debt relief agency.  It helps people file for bankruptcy under the bankruptcy code.  No attorney-client relationship with the firm of Halcomb Singler, LLP, is created through this blog. Also, please note that Erika Singler is an attorney licensed in Indiana and does not seek to practice law in any jurisdiction in which they are not properly authorized to do so.  The information contained in this blog is general in nature and should not be relied upon for the circumstances of any individual(s) or businesses.