South Carolina residents may pass bankruptcy means test

On Behalf of | Jul 28, 2016 | Chapter 7 |

Many individuals may feel as if they do not have a way out from under their crippling debt. However, for many South Carolina residents, Chapter 7 bankruptcy may be an option of which they could take advantage. In order to move forward with the bankruptcy process, an individual must first qualify, and passing the means tests is the first step toward achieving financial freedom for many.

The bankruptcy means test determines eligibility for discharging debt. There are two ways an individual may be able to use the means test to qualify for Chapter 7. The first step involves figuring out the household income and expenses for the six months prior to the test. These six months will provide the basis for which the test is conducted. If the household income is below the median income for the state, the individual passes the test.

For individuals who do not have a household income below the median level, step two of the test examines disposable income. Disposable income pertains to income remaining after allowable expenses are deducted, such as groceries and rent. If individuals have disposable income levels that are low, they may still qualify for Chapter 7.

Knowing that qualifications are necessary and tests must be passed in order to qualify for Chapter 7 bankruptcy may cause South Carolina residents to feel apprehensive about beginning the process. However, there is assistance available that could help individuals better understand the test and the documents that could be useful during the qualification proceedings. Discussing concerns with experienced bankruptcy attorneys could help interested individuals move toward fresh financial starts.

Source:, “The Bankruptcy Means Test: What It Is, Why It Matters”, Sean Pyles, July 14, 2016

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