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Tucson Chapter 7 Bankruptcy – Do I Qualify?

 

In Tucson, Chapter 7 bankruptcy can be a complicated matter, and we highly recommend hiring a Tucson lawyer who can help you determine whether you qualify. While bankruptcy attorneys are best for determining whether you qualify, this article should give you a good idea as to whether you qualify. Keep in mind that if you don’t qualify for Chapter 7, you may still qualify for Chapter 13 bankruptcy.


In order to file for bankruptcy under U.S. law, you must live in the U.S. and either have a place of business in the U.S. or own property in the U.S. Chapter 7 is not available to anyone who has had a bankruptcy case dismissed within the 180 days prior to filing.


When filing for Chapter 7 bankruptcy your case must undergo a “Means Test” to determine your eligibility. The means test consists of three parts and is outlined below.

 

 

Tucson Chapter 7 Bankruptcy means test part one

 

The first part of the means test compares your household income to the number of people in your household. Most people who file for bankruptcy qualify under this part of the test. Look on the chart below; if your average monthly income is lower than that shown for your household income, then you probably qualify for Chapter 7 bankruptcy. You must include ALL “before-tax” income for everyone living in your house. If you live in Tucson, and Chapter 7 bankruptcy will not apply to you under this part of the test, you may still qualify under the next two parts of the means test.


Total Household Income Compared To Household Size

 


Household Size

Monthly Income

Annual Income

1 Person

$3,522

$42,628

2 People

$4,741

$56,894

3 People

$5,172

$62,066

4 People

$5,788

$69,452

5 People

$6,363

$76,352

6 People

$6,938

$83,252

7 People

$7,513

$90,152

8 People

$8,088

$97,052

9 People

$8,663

$103,952

10 People

$9,238

$110,852

 

 

Bankruptcy Attorneys Look at Allowable Expenses – Means Test Part Two

 

If you don’t qualify for Chapter 7 under the first part of the means test, you can then look at the expenses that would be allowed under Chapter 13 bankruptcy. If the allowed expenses would leave you without enough discretionary income to make a payment to creditors under a Chapter 13 payment plan, you can still qualify for Chapter 7 bankruptcy.

 

However, if your discretionary income would be more than $150 per month, you may still have to file for Chapter 13 bankruptcy.
Calculating your allowed expenses and discretionary income is a very complicated process, because of the bankruptcy law requirements, and should be left to a Tucson lawyer experienced in Tucson Chapter 7 bankruptcy law.

 

 

Special Circumstances – Means Test Part Three

 

If you do not qualify for Tucson Chapter 7 Bankruptcy under the first two tests, but have special circumstances that would make it difficult to fulfill a Chapter 13 payment plan, you may still qualify for Chapter 7. Under this test, you’ll have to petition a U.S. Bankruptcy Trustee to make an exception to the normal income and expense guidelines because of your special circumstances. You will have to list all the circumstances that impact your financial situation and state how they will prevent you from fulfilling a payment plan. If the Trustee objects to your petition, you can have your case reviewed by a bankruptcy judge. If the both deny your petition, you will have to file for Chapter 13 bankruptcy.


Ready to talk to an attorney about filing for Tucson Chapter 7 bankruptcy? Talk to a Tucson lawyer at no cost to you. Click here and fill out our information form.

 

Better still, call today and talk to Attorney Jeffrey Judge at 520-745-1500

 

Need more information on Tucson Chapter 7 Bankruptcy? Check out these additional articles:
Chapter 7 Bankruptcy – What you need to know
How to File for Chapter 7 Bankruptcy
Bankruptcy Chapter 7 Exemptions in Arizona