Income Too High ? ?

[ndcorley]

After doing a little research, I see that if your income is above the median income level for your geographic location, you cannot file chapter 7. Is this right?

[kenshirley]

Yes you are correct. Family size also comes into play.
It varies state to state and specific areas.
They will be looking at all sources of gross income for the 6 month period immediately prior to your filing.
You can go to this link to get the income for your area~~

http://www.usdoj.gov/ust/eo/bapcpa/meanstesting.htm

[ndcorley]

What if your income is above the median level, but outgoing expenses are more than the monthly income?

[zpbk13]

We are above the median income for our family size and I automatically thought that meant a 13 abut my lawyer says that's when you take the means test and see how much disposable income you have. If you are under a certain amount based on monthly expenses then you can still qualify for a 7. We are waiting to hear back from our attorney but she said it's going to be close so I am resolved that we are going to be in a 13.

[lrprn]

Yes you are correct.

Actually, Ken, this isn't correct.

A filer absolutely *CAN* file Ch 7 and be above the median income for their state and family size. We have several active members here currently who have done just that.

What decides Ch 7 vs Ch 13 is if the filer shows more or less than about $165/month of disposable income ON THE MEANS TEST (not by subtracting real income from real expenses). Less than $165/month = you can file Ch 7. More than $165/month = probably have to file Ch 13 unless additional expenses can be found that were forgotten on the filing forms.

[lrprn]

What if your income is above the median level, but outgoing expenses are more than the monthly income?

ndcorley, see my response above at http://www.bkforum.com/showthread.ph...d=1#post267218 that corrects inaccurate information posted earlier.

In a nutshell, yes, you can be above the median income in your state for your family size and still file Ch 7. It al depends on the mix of your income, value of your assets, and expenses on the Means Test and Schedules.

[zpbk13]

That is why we are holding our breath. Our dmi is above that $165 number so we are seeing if there are other allowable expenses that we can claim - waiting to hear back from lawyer.

This forum is so awesome. The flow of information makes me feel so knowledgeable when I talk to my attorney.

[StartingOver08]

[QUOTE=ndcorley;267186]After doing a little research, I see that if your income is above the median income level for your geographic location, you cannot file chapter 7. Is this right?[/QUOTE]


NO! This is not correct. If your income is above median, it just means that you have to fill out the entire test plus the schedules I and J to determine if you have any disposable income to make Ch 13 payments. The income is just HALF of the process.

Many of us were above median, by a lot, and were able to successfully file a Ch 7.