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Los Angeles Bankruptcy Lawyers / Blog / Bankruptcy / 3 Common Mistakes Made on the Bankruptcy Means Test

3 Common Mistakes Made on the Bankruptcy Means Test


The bankruptcy means test is one of the first steps to filing for bankruptcy. It determines if you qualify for Chapter 7 bankruptcy and it impacts the length of your Chapter 13 bankruptcy. Without proper guidance, bankruptcy applicants often make mistakes when completing the means test. With that in mind, here are the 3 most common mistakes our bankruptcy attorneys see on the means test.

Mistake #1: Listing the Wrong Household Size

When completing the means test, you will be required to add your household size. Often, applicants get this number wrong since determining the correct household size can be tricky. Your household size can have a significant impact on your means test results because it will determine the median family income and the standard deduction amounts for housing expenses.

A good rule of thumb is to determine if the individuals in your household are financially dependent. For example, if your grandmother lives with you without paying rent, they would be considered a member of your household since your income goes towards providing for her. However, if your cousin is staying in a spare room in your house and is paying their share of the rent, they wouldn’t be considered a household member.

Mistake #2: Including Inaccurate Income

The amount of income you include in your means test is important because it will affect your bankruptcy chapter eligibility. For such reasons, you should ensure that the income you list in your means test matches your income documentation. Look through your documentation and find your average income in the last six months. You can use your tax returns as a reference, but keep in mind that not all types of income should be included.

Mistake #3: Listing Income You Don’t Receive

Another common mistake individual make in their means test is listing income they don’t receive. For example, if you haven’t received child support that’s owed to you, you shouldn’t report it as income. Likewise, you can’t list child or spousal support expenses if you aren’t paying them.

Avoid these mistakes by contacting our Los Angeles bankruptcy attorneys today at (800) 996-9932. We can guide you through the means test to help you avoid common mistakes.

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