Filing For Bankruptcy and Your Finances

filing for bankruptcy, Bankruptcy-Means-TestingAre you considering filing for bankruptcy in Jacksonville Florida? If so you may be wondering why you need to have an experienced Florida bankruptcy lawyer when you decide to file. There are plenty of good reasons why an experienced lawyer who really knows bankruptcy law in Florida is important when you file for bankruptcy.

Among the many reasons is that you want to have a Florida bankruptcy lawyer. This will mean they are very familiar with Florida’s requirements for filing for bankruptcy. While the basic laws may be the similar there are a few things that change from state to state. Then there are the reasons that go beyond just knowing the law. They also understanding the financial aspects of filing for bankruptcy in Florida.

Another of these reasons is The Means Test. No, it isn’t the kind of test you can study for. However, it is one you want to understand. More importantly you want your Florida bankruptcy lawyer to completely understand. Here is why.

Florida Bankruptcy Means Testing

In a Jacksonville Florida bankruptcy, as in any bankruptcy in the U.S., you will need to determine your eligibility to file for bankruptcy. The bankruptcy means testing is way for the courts to decide if you fulfill the requirements for a Chapter 7 bankruptcy. Also, if not, what you can expect to pay your unsecured creditors when filing for a Chapter 13 bankruptcy.

This test will help the courts to determine what your legal definition of your income is. This is not the same as how much you take home every month for a paycheck. Even if you are unemployed, there is still an amount that is considered your income. This test determines what the courts will allow.

To define it, you will need to provide:

  • An assessment of your total monthly income as it now stands
  • All expenses you are allowed to take, according to section 707(b)(2) of the Bankruptcy Code
  • All of your defined disposable income if filing a Chapter 13 bankruptcy

When determining your income for the means test, it is an average of any income you made in the six months prior to the case being filed. Social Security is one of the few sources of income not counted in a means test.

The math can get very complicated. This is another reason to have an experienced bankruptcy lawyer. The important thing to understand is that you must do this. Without this test you cannot determine if you even qualify to file for a Florida bankruptcy.

Find Out the Truth about Filing for Bankruptcy

Confused yet? There is so much to know and understand when it comes to filing for bankruptcy. Looking for more information? You might want to download our free EBook Myths, Secrets and the Truth About Bankruptcy in Florida. It will show you if filing for bankruptcy is the right step for you. We have plenty of information on our website Restart Your Life and are always happy to set up a free consultation to discuss your particular financial situation with you. Taking that first step can be hard, but once you do you will find that filing for bankruptcy in Florida doesn’t have to be something you do alone.