Means Test

Boulder Means Test Lawyers

Helping Clients in Boulder, Longmont, and Surrounding

If you are considering filing for bankruptcy, you might be concerned about passing the Means Test. While we cannot guarantee that you will pass, we can help you determine your eligibility to file.

At Goff & Goff LLC, our bankruptcy attorneys have over 20 years of experience helping people through this process. We have helped many people file for bankruptcy, and we can help you, too. Whether it is Chapter 7 or Chapter 13, we can help you. Our goal is to help you find the best path to financial freedom.

To learn more, speak with a means test attorney in Boulder at Goff & Goff LLC. Contact us online or call (303) 816-3171.

What Is the Chapter 7 Means Test?

The Chapter 7 means test is a crucial component of the bankruptcy process in the United States. It was introduced as part of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) to determine an individual's eligibility to file for Chapter 7 bankruptcy.

The means test evaluates a debtor's financial situation to assess whether they have the means to repay their debts or should pursue debt relief through Chapter 7.

How to Calculate Your Available Income for the Means Test

The Means Test is used to determine whether you are able to pay back your creditors through a Chapter 7 bankruptcy. You must meet certain requirements in order to pass.

To calculate your available income, you must:

  • Determine the relevant time period for calculating your income. Start with the 6 months leading up to your bankruptcy filing date and exclude the month when you are filing. For example, if you are filing in October 2023, look at your income between April 1, 2023 and September 30, 2023

  • Review your sources of income. Gross wages are what you earn before taxes and other deductions are taken out. Below are soem other sources of income you must include in the means test:

    • Spousal support

    • Child support

    • Unemployment

    • Retirement

    • Business income

    • Income from rental property, etc.

  • Compare your income to the Colorado median income at the United States Department of Justice website. Find the section titled “Data Required for Completing the 122A Forms and the 122C Forms” and select the time period in the drop-down menu that applies to you. Find the link titled “Median Family Income Based on State/Territory and Family Size” and you will see a chart that shows Colorado’s median income.

  • Look at your total household income compared to the amount on the chart for Colorado and your household size.

  • Account for your expenses. Calculate if you have enough disposable income to pay 24% of your priority unsecured debts within 5 years. If you are unable to pay the debt within 5 years, you are eligible for Chapter 7.

Why Choose Goff & Goff LLC?

Bankruptcy is a serious decision, and we understand that. At Goff & Goff LLC, we can help you determine whether you qualify to file for bankruptcy and can help you pass the Means Test. We can also help you through the rest of the bankruptcy process.

If you decide to file for bankruptcy, we can help you file for Chapter 7 or Chapter 13. If you file for Chapter 7, we can help you with your liquidation. If you file for Chapter 13, we can help you with your payment plan.

If you decide not to file for bankruptcy, we can help you find other debt-relief solutions. We can help you with lawsuits, wage garnishments, repossessions, foreclosure defense, credit repair, and alternative debt relief. We can also help you if you have student loans or medical bills. We have helped many of people in all of these situations, and we can help you, too.

Talk to an experienced means test attorney in Boulder at Goff & Goff LLC. Dial (303) 816-3171 or reach out online.