Exception To Means Test

Exception to Means Test for Bankruptcy Explained by Jacksonville, Florida Bankruptcy Lawyer

Debtors filing for bankruptcy under Chapter 7 of the U.S. Bankruptcy Code must take and pass the means test. Despite being a primary requirement for a Chapter 7 bankruptcy, there may be some instances when a debtor can qualify for the plan without having to take a bankruptcy means test Jacksonville. Ask our expert lawyers about this preliminary requirement if you want to know more about means test for bankruptcy in Jacksonville. Here at The Law Offices of Justin McMurray, P.A., we lend our expertise in bankruptcy and foreclosure defense, debt settlement, and related cases to help you get back on track legally and financially.

Bankruptcy means test Jacksonville was only added to the eligibility requirements for a Chapter 7 bankruptcy in 2005. It is meant to prevent higher income filers from using the bankruptcy form to escape debt payment. Instead, these filers are required to repay some of their debt through a Chapter 13 bankruptcy. Filers whose income is lower than the median income of the state may qualify for a chapter 7 without taking a means test Jacksonville exam. However, those whose income is higher must pass the test to verify eligibility.

Typically, the Jacksonville means test for bankruptcy compares your current income to various allowable expenses to see if you truly can’t repay even a portion of your unsecured debt.

Exceptions to the means test also exist. When qualified, these situations allow you to forgo the means test and still qualify for a Chapter 7 bankruptcy. These exceptions are as follows:

  1. You will be exempt from a means test for bankruptcy in Jacksonville if more than half of your debts are non-consumer in nature. Non-consumer debts are business debts that you incur with profit motives in mind. This said, other courts consider income tax debts as non-consumer debts as well.
  1. You are also excused from taking the means test if you are a disabled veteran and the debts were incurred while on active duty or while doing homeland defenseactivities. A disability rating of 30% is required for you to qualify for this exemption.
  1. Lastly,if you are a member of the National Guard or the military reserve, you mayalso be exempt from the means test requirement, given that you meet the specified criteria.

Please contact a Jacksonville bankruptcy attorney at The Law Offices of Justin McMurray, P.A. today for a better consultation about this option.