It should be pointed out that the means test is primarily designed for people who have consumer debts (e.g. medical debt, payday loans, personal loans, car repossessions, foreclosures, or credit card debt). It should also be pointed out that, while the test can be confusing and requires a lot of paperwork, your attorney at Thomas Legacy Law Firm will guide you through the process. Regarding your income, the test is used to determine if your income is below the median income in Illinois. If it is, you can generally file for Chapter 7 Bankruptcy in Chicago. Schedule a Free Consultation with Thomas Legacy Law Firm and our lawyers will review your income to determine if you are eligible to file a Chapter 7 Bankruptcy.
But let’s say your income exceeds the median income in Illinois—there is a second portion of the means test that may allow you to file for Chapter 7 Bankruptcy. This portion of the test looks at your expenses. With the help of your Thomas Legacy Law Firm bankruptcy attorney, you will add up all of your living expenses (referred to in bankruptcy court as “allowable expenses”).
Allowable expenses include things like rent, medical expenses, and groceries. Your bankruptcy attorney at Thomas Legacy Law Firm will be able to advise you on which of your expenses are allowable. This is where having an experienced attorney is crucial, as a mistake or misunderstanding on this portion of the means test could result in your case being thrown out. The money you have left after these allowable expenses are totaled is your “disposable income.” If this amount is low enough, you may qualify for Chapter 7 Bankruptcy in Illinois.