First things first, there are two ways you can qualify for Chapter 7 bankruptcy in Florida:
- If your current household income is lower than the median income for your family in Florida, you're may be in luck. You can use the Florida bankruptcy means test calculator to estimate your qualification. Just keep in mind that there are some incomes that are excluded from the means test, so take note of that.
- Now, if your current household income is higher than the median income, you may still have a shot at qualifying if you have deductible expenses. Use the Florida above median bankruptcy means test calculator to estimate your chances.
The Florida bankruptcy means test calculators below can be super helpful in figuring out next steps. They're updated with the latest data for 2023 - 2024, so you can rely on them to give you a good estimate. If your income level is lower than the Florida Chapter 7 bankruptcy income level, you might only need to take one calculator.
Florida Bankruptcy Means Test Calculator
So, let's talk about bankruptcy forms in the US. There are three of them that you need to know about. The first one is called the Chapter 7 Statement of Your Monthly Income form. It's used to figure out if you qualify for bankruptcy. Now, if you're in Florida, there's a bankruptcy means test calculator that's based on this form. It helps you estimate if you qualify for bankruptcy.
This calculator also gives you an estimate of how much it'll cost to file bankruptcy in Florida with an attorney. So, if you're curious about your eligibility and the cost, try the Florida Chapter 7 Means Test calculator below:
Chapter 7 Means Test Explanation
The means test is the exam used to see whether you make within the income thresholds to file Chapter 7 bankruptcy in Florida. The bankruptcy forms do some number crunching to figure out your average monthly income, and then they go and annualize that to get your average annual income.
Now, there are a few things you need to keep in mind when it comes to this means test. If you're in Florida, they're gonna look at your entire household income, even if your better half isn't filing with you. Keep in mind, if you're legally separated, things might be a bit different. Just a heads up.
Next, the means test compares your income to the income thresholds for the Chapter 7 means test in Florida.
Now, diving deeper into how they calculate your average monthly income for the means test you can review the Average Monthly Income for the Florida Bankruptcy Means Test.
Oh, and one more thing. If your income is all over the place, you might wanna check out this calculator. It's designed to give you an estimate of your average monthly income for the means test. You can find it right here: Average Income Calculator.
Alrighty then, let's dive into how the bankruptcy means test is calculated in Florida for cases filed in 2022.
Florida Chapter 7 Bankruptcy Income Limit
When it comes to Chapter 7 Bankruptcy Florida income limits, I've got some interesting info for you today about household income levels for bankruptcy cases in Florida. Now, I know bankruptcy can be a tough topic, but it's important to stay informed. So, let's dive right in. These figures I'm about to share with you are specifically for bankruptcy cases filed on or after November 1, 2023. These numbers actually change every six months or so. Now, if you're wondering how these income levels are calculated, it's based on the size of your household. If you've got more than nine people in your household, you'll need to add $9,900 for each additional family member. Here's the table below:
What Is Considered Income?
Now, let's dive into the Florida bankruptcy means test. Not all income is included in this test. For instance, certain disability and social security income are exempt from the bankruptcy means test. Which may be good news for those individuals. There are a couple more types of income that are also not included in the Florida means test, like payments for war crime victims and payments related to a national emergency, such as the ongoing COVID-19 situation.
Now, let's take a closer look at the types of income that are included in the Florida bankruptcy means test. The test covers any regular payments made by entities other than the debtor to cover household expenses. It's a pretty broad definition, so let's break it down into a few categories:
- Salaried income: That's your regular paycheck.
- Spousal income: If you're in a joint case or not legally separated, your spouse's income counts too.
- Hourly and overtime income: working over the normal threshold
- 1099 Income: If you're working for gig economy platforms like Uber or Lyft, that income may be included.
- Net Rental Income: If you're making money from renting out a property, it may be considered.
- Florida government income: Income from the Florida government may be included as well.
- Child support and Alimony: Yep, those payments may be included as well.
- Dividend, Interest, and Royalties: Money coming from investments and intellectual property could be on the table.
- Pension and Retirement Income: Retirement income and pension may be considered.
- Net business income: If you're running a business, the money you make may be taken into account.
- Annuity payments: Regular payments from an annuity may be considered too.
- Unemployment compensation: If you're receiving unemployment benefits, they may be part of the equation.
- Worker's Compensation Benefits: If you've been injured on the job, any compensation you receive may be included.
Now that we've covered the income side of things, let's move on to how household size is calculated.
What Is Considered In Household Size?
So, here's a question that often pops up: how exactly is household size determined? Well, let me break it down for you. Your roommate might not be considered a part of your household size, but typically, your children who you claim as dependents on your taxes would be included.
Now, things can get a bit tricky if you have children who are away at college or if you're engaged but not yet married. Different bankruptcy jurisdictions in Florida might have their own rules on who can be counted as part of your household. It's a bit of a puzzle, but it's important to understand the guidelines in your specific area.
Florida Above Median Bankruptcy Means Test
So, you've got your calculator out and it seems like your income is higher than the average household income in Florida. But don't worry, there's still a chance you could qualify for bankruptcy based on two additional means test forms. Let me break it down for you:
The first form is called the "Statement of Exemption from Presumption of Abuse Under §707(b)(2)". It's a fancy way of saying that you can provide some evidence to show that even though your income is high, you still need bankruptcy relief.
The second form is the "Chapter 7 Means Test Calculation". This is where things get interesting. You can deduct certain monthly expenses from your current monthly income to figure out your disposable income. These expenses include both national and Florida-specific costs.
Now, let me explain what disposable income is. It's basically the money you have left after paying all your expenses. And if your disposable income falls below a certain amount, you might still be eligible for Chapter 7 bankruptcy.
To make things easier, there's a calculator below that uses both forms to help you estimate and determine if you may qualify for Chapter 7 bankruptcy in Florida:
Allowable deductible expenses
If you're going through the bankruptcy means test, you might be wondering what expenses you can deduct. Well, I've got you covered with the breakdown on the certain expenses you may be able to deduct.
- First up, we've got mandatory employment deductions like union dues, retirement plans, and uniforms. Those may be considered.
- Next, health and disability insurance premiums.
- Don't forget about income taxes.
- If you're shelling out for child care.
- Term life insurance premiums
- Secured debt payments for your car and home are also on the list
- Alimony and child support payments
- And last but not least, charitable contributions, but there's a catch. They're limited to a percentage of your income.
Now, those are the certain expenses you can deduct. You might be able to deduct other expenses too, depending on your special circumstances. However, keep in mind that these deductions have limits based on the number of people in your household. To find out the maximum amounts allowed for these expenses, you can check out the current national standards.
- Need to stock up on housekeeping supplies
- Clothing expenses
- Food expenses
- Personal care services and products
- Housing and utility expenses
- Transportation expenses
- Out-of-pocket healthcare expenses
Those are the expenses you may be able to deduct on the second part of the bankruptcy means test. If you have any other questions, it's always a good idea to reach out to a local bankruptcy attorney in Florida for a free evaluation. They'll have all the answers you need.
What Happens If You Fail the Bankruptcy Means Test?
Let's say you're in Florida. Well, you can give some thought to filing for Chapter 7 bankruptcy. But that's not your only option, you know. There are other alternatives to bankruptcy that you might want to consider.
On one hand there is debt settlement. It is the process where you or a company may negotiate with your creditors and potentially reduce the amount you owe. You also have debt management. With this option, a credit counseling agency can help you come up with a plan to repay your debts. And if you're feeling extra ambitious, you can give debt payoff planning a go. It's all about creating a strategy to pay off your debts in a timely manner.
Chapter 13 Bankruptcy
A Chapter 13 bankruptcy in Florida is like a wage earner's plan. You make a payment plan to pay back a portion of your unsecured debts. The good news is that you can usually keep your assets, and there's no need to qualify as long as you're under the debt limits. Plus, it only stays on your credit report for 7 years instead of the usual 10 years. The payment plan can last either 36 or 60 months, but if you're in a 100% Chapter 13, your plan might be shorter.
Now, why would someone choose Chapter 13 over Chapter 7 bankruptcy? Well, some individuals go for Chapter 13 if they have more equity than what's allowed under the Florida bankruptcy exemption. It's a way to protect their assets while still dealing with their debts.
So, let's talk about debt settlement. It's when you or a company negotiate with your creditors to reduce the amount of debt you owe. Basically, they cut you some slack and forgive a portion of what you originally owed. For example, if you had a whopping $50,000 in debt, debt settlement might bring that down to a more manageable $25,000.
Now, debt settlement usually involves a payment plan that can stretch anywhere from 12 to 60 months. It gives you some breathing room to pay off your debt without drowning in it.
But hold on, there's a catch. When it comes to debt settlement, you need to be careful about which company you choose. Some of these companies can charge you more than a quarter of your enrolled debt, which is pretty steep over the course of the program. So, it's important to do your research and find a reputable company.
Keep in mind that many debt settlement firms are national, so you don't necessarily have to find one that's local to Florida.
Debt management, my friend, is like having a superhero on your side, swooping in to negotiate with your creditors and lower the interest rate on your debt. For example, you owe money with an interest rate of 22%, but a debt management company comes to the rescue and slashes that rate down to a 9%.
Debt management companies, often non-profits, work on credit card interest rates but they might not be able to help with those unsecured personal loans. It's like a payment plan that lasts anywhere from 36 to 60 months. You make regular payments to the debt management company, and they distribute the funds to your creditors. It's like having a middleman to handle all the stuff while you focus on getting back on your feet. Many of these debt management firms are national, so you don't have to go searching high and low for one in your local Florida neighborhood.
So, you're curious about the bankruptcy means test and income limit in Florida for Chapter 7 bankruptcy qualification? I get it, it can seem pretty overwhelming. But don't worry, I'm here to break it down for you in a way that's easy to understand.
First things first, let's talk about why Chapter 7 bankruptcy is often the preferred option for many folks in Florida. One big reason is the cost. When it comes to filing for bankruptcy in Florida, Chapter 7 is often the most affordable debt relief option out there.
Now, let's dive into the basics of how the Chapter 7 bankruptcy means test and income limit work in Florida:
- The first part of the test looks at how your household income stacks up against the Florida income limit. But don't worry, not all types of income are included in this calculation. Some are included, while others are excluded.
- If your household income exceeds the limit, don't lose hope just yet. You may still qualify for Chapter 7 bankruptcy in Florida based on your expenses and deductions.
- But let's say you don't pass the bankruptcy means test. Don't fret! There are still other options available to you, like Chapter 13 bankruptcy, debt settlement, and debt management. It's all about finding the right fit for your unique situation.
I hope this article has shed some light on the bankruptcy means test and income limit in Florida. If you want to get a better idea of whether you qualify for Chapter 7, go ahead and use the Florida bankruptcy means test calculator below. It'll give you a rough estimate of where you stand.