My Income Is Above Median Can I Still File Chapter 7? Maryland Bankruptcy Attorney

Описание: Thoughts from a Baltimore bankruptcy attorney:
http://www.drescherlaw.com

Chapter 7 relief is not necessarily denied to a debtor just because their income is above the median income for their state. Such debtors may still qualify for Chapter 7 relief but instead of filling out the 1 page short form they will have to complete the 7 page long form.

The long form contains a series of deductions that are based on national and local IRS standards as well as certain deductions that are specific to the debtor.

National deductions:
• Food, clothing, other items
• Out-of-pocket health care

Local deductions:
• Housing and utilities, non- mortgage expenses and rent
• Transportation, ownership costs such as maintenance and fuel

Needs-based deductions:
• Taxes
• Court ordered payments
• Union dues
• Life insurance
• Childcare

Secured debt deductions:
• Mortgage payments
• Car loans
• Amounts needed to cure arrears on secured debt

IRS national and local deductions are available at http://www.usdoj.gov/ust/

The long form is used to ascertain a debtor's net disposable income. This figure is reached by subtracting the permitted deductions from the debtor's gross annual income. After doing this analysis, an above median income debtor may still qualify for Chapter 7 if monthly net disposable income x 60 months is less than

(I) 25% of the debtor's non-priority unsecured claims in the case, or $7,025, whichever is greater; or

(II) $11,725

To see more about the means test see this video:

   • Bankruptcy: What is the Means Test? Maryla...  

To see the median income for your state click here:

http://www.justice.gov/ust/eo/bapcpa/...

Thoughts from a Maryland Bankruptcy Lawyer

Ronald J. Drescher
Drescher & Associates, P.A
4 Reservoir Circle
Suite 107
Baltimore, MD 21208
(410) 484-9000
Fax (410) 484-8120
[email protected]
http://www.Drescherlaw.com

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Practicing in Maryland, Delaware, Virginia, Pennsylvania