Mistakes Often Made on the Bankruptcy Means Test
The means test is typically the beginning stage for any individual who is contemplating filing for insolvency. It ascertains whether you are qualified for Chapter 7 insolvency, and affects the length in your arrangement in a Chapter 13 insolvency. The means test is a troublesome document, and errors are bound to happen
Income and Documentation That Do Not Match
The salary you list on your means test document must match your salary documentation. Typically, the day you receive your wages, the amount of days in a month, or the timing of when you filed for insolvency will impact your wages figures enough to effect whether you are qualified to declare Chapter 7 bankruptcy or should you have to file Chapter 13, whether you have to make installments in excess of three years or five. It is recommended that you also take a look at your monetary documentation with great care to see whether there were some other sources of wages earned during the time period. Installments that were only paid once will probably be accrued towards your salary and are barely noticeable.
Incorrectly Determining the Household Size
Deciding the right family unit size to utilize can be difficult, particularly since the courts have a tendency to differ on this. A small amount of courts have the excessive view that you include everybody who is currently living your home. Different courts have included just those tenants who are monetarily dependent on the account holder. Your family unit size can have critical effect on the grounds that it is utilized to assess the average family salary for examination to your own, and the standard subtraction sums for lodging and certain costs. A decent general guideline is to consider whether the inhabitants are somehow monetarily related and structure one monetary unit. For instance, an elderly parent who lives with the family would be a part of the family, while a guest who rents a room in your home however pays just lease and doesn’t help further towards costs and doesn’t impart family assets, would by and large not be considered a part of the family.
Child Support Claimed, But Not Received
Child support is considered salary only in the event that it is being received. It is not recommended to state child supports that you are supposed to be receiving but are actually not, as salary. It is also important to note that child support cannot be claimed as a cost if it is not being paid.
Tax Deductions That Are Off Limits
401k credit reimbursements, retirement account commitments, and the actual 401k are a few samples of costs which are not deductible. Cellular phone plans are incorporated in the standard utility allowance and are not separate. School costs for your child are typically not deductible yet training costs as a state of your job would be deductible.
Not Claiming the Marital Adjustment When Available
If you and your spouse are not filing bankruptcy together, you still have to include your spouse’s income in the Bankruptcy Means Test. However, the Bankruptcy Means Test also allows you to deduct certain expenses your spouse may have such as (but not limited to): Student Loans, Credit Card Payments, Alimony / Child Support Paid, Cell Phone Bills. This list is not exhaustive – and a competent bankruptcy attorney can help you in this analysis.