With a Threshold debt payment amount < 25% Can I automatically Pass the Means Test

[shabam]

I understand I'd have some trouble with expenses, I'm just wondering if the 25% limit is ever used?

Some trouble is an understatement.

I have never heard of the 25%

[LimpDisc]

The debt threshold wouldn't be there if it wasn't used. Like the other posters have already stated, be ready to explain all of your expenses with the high of income.

[debtinohio]

I understand I'd have some trouble with expenses, I'm just wondering if the 25% limit is ever used?

[dakota112]

I really feel for you, as I was in your same situation until I just decided to do the best I can to get a fresh start and escape from all this nonsense, live and learn and move on. For me that meant shedding almost everything I can to get under the median, lose my job and get whatever help I can from family and press on. I just don't want these trustees to have an excuse that they can dismiss or deny me my constitutional right based on their rules. My atty will do the rest. Having to go throught the hoops and hurdles of the means test and all of its associated nonsense just adds to the aggravation. I didn't want to have to deal with it. The totality of circumstances, job loss, age, economy etc should be working in your favor.

[debtinohio]

Also needs to keep in mind that Music lesson for the kids, $500 401k payments etc are all red flags and grounds for dismissal.

None of that, thanks though.

[debtinohio]

$132K sounds fine except take home is $6700/month after child support, taxes, insurance, standard HSA deposit. Take the 5 person IRS expenses + $2400 for house, $550 & $600 for the cars, $450 utilities, etc and it's not $1000 left.

The tutor is $120/month and is for a child below reading level. I believe the IRS deduction is $130/month for educational expenses.
Back to my original ? - - can the means test be passed being below the 25% payback level?

[dakota112]

I have negative DMI now also. My lawyer made it clear as I was also a previously high income earner, to get my income down under the median and only then would she be comfortable pursuing a CH7 for me. So I have done that and will file in 2 months. Why suffer in a ch13? 5 YEARS? That is like a prison sentence.

[shabam]

Also needs to keep in mind that Music lesson for the kids, $500 401k payments etc are all red flags and grounds for dismissal.

[whipster1]

The worst case scenario, you would be converted. You better have good records for each expense, and none of them can be luxuries...the tutor is first to pop up as a red flag.

[shabam]

You seriously want to file a ch 7 with a $132K salary.

You are going to have some serious explaining to do. You will also need to get ready for thorough examination by the UST.

[debtinohio]

Hi -

In order for me to meet the 25% Threshold debt payment amount I would need a disposible income of at least $1029 (unsecured cards 215K, student loans 32K)

With 2 cars, House, Child Support, Basic IRS Limits for the rest, I'm already at like $800 disposible income before I add any of my own deductions which would bring me negative but might be challenged (kids activity, tutor, cell phone, etc).

Can I outright qualify for a 7 by not meeting the Threshold debt payment amount??

My attorney was pushing for a Ch13 only because our gross income is $132K (family of 5), I'm looking for alternatives.

Thanks in Advance!