Income qualifications for BK

[Uncle Rico]

The income allowed, is it adjusted gross, or just plain gross.

Scenario: High paying job with no health insurance for family. Is the income adjusted down to allow for insurance or medical costs?

Scenario: Low paying job with great health benefits for entire family.

Am I correct that a low paying job with good benefits could protect my ability to qualify within the income guidelines, while the higher paying job may put me out of BK even though I have high medical and insurance costs?

[LadynRed]

I guess it all depends on WHEN you file. If you file now, your total income doesn't mean much, its DISPOSABLE INCOME that matters. You take your Gross, subtract all your taxes and benefits, and what's left is what you subtact your expenses from.

IF you wait to file until after 10/17 when the new law goes into effect, then your total income against the median for your state will be a big problem if you're over the median. ACTUAL expenses will have little impact as you will ONLY be allowed those expenses as allowed by the IRS collection standards -- and they are ridiculously low and VERY restrictive.

[ghacorp]

It's pretty much reasonable and customary living expenses now. I guess after bk reform, it'll just have to be a few fewer cruises over the course of the five years! LOL

[Alexander]

You might want to talk with a BK attorney in your area. I always thought what pushed one from CH 7 to CH 13 way if they could pay back 100% of the debt in 60 month max.

I filed BK CH 7 on 25K of credit card and medical debt with a income of 25K. I had no problems with the judge at all.

How much debt do you have?

[LadynRed]

Payback in a Ch 13 depends on your disposable income. Its rare that ANYONE pays back ALL unsecured debts at 100%. Secured debts MUST be paid at 100%, but unsecured payback can be as low as 2%. It all depends on what you've got left over to pay and how much total unsecured debt you have.