What Is the Bankruptcy Means Test in Alaska?

In 1967, Alaska's state motto, "North to the Future" was chosen to reflect the fact that Alaska is a land of promise; which it is. But a promise is not a guarantee. Living in Alaska provides residents with unlimited opportunities for enrichment, adventure, and fulfillment. However, it’s difficult for families to focus on these benefits of living in "The Last Frontier" when they are struggling to make ends meet. If your inability to pay your bills is making it impossible to enjoy Alaska's promise, know that there are debt relief options available to you and your family. If you are a member of a lower-income household, you may benefit most from filing forChapter 7 bankruptcy. This process allows you toerase most or all of your debts within 90 days of filing. As an added benefit, in most Alaska bankruptcy cases, low-income filers are able to keep most or all of theirproperty safe from creditors. To qualify for Chapter 7 bankruptcy, your income must fall withinspecific limits and you must pass the Chapter 7 Means Test.

Alaska Median Income Levels

Discharge in Bankruptcy for Alaska

If you pass the Chapter 7 Means Test, you are eligible for an Alaska bankruptcy discharge in a Chapter 7 case. The Court hands down a discharge order to erase your eligible debts once you have completed each step of the Chapter 7 bankruptcy process. Filing for Chapter 7 is generally a straightforward process. Therefore, as long as you follow all directions carefully, you should be able to successfully file without hiring an attorney. Once you have been granted your discharge order, you can get back to enjoying Alaska’s promise instead of spending your time worrying about how to pay back all of your creditors.

Alaska Means Test Calculator

When the Court orders your bankruptcy discharge, it will deny creditors the right to keep requesting payment from you. Because a bankruptcy discharge keeps creditors from collecting legitimate debts, the Court has an interest in only allowing families that truly can’t pay their debts to qualify for this legal protection. It examines a person’s household size, income, and expenses through a Chapter 7 Means Test to determine whether the person should be granted a discharge without first committing to a 5-year Chapter 13 plan. To determine whether you pass the Alaska bankruptcy Means Test, you can access an Alaska Means Test calculator online. Make sure that the calculator you use is state-specific and up-to-date, as not all sites that offer these resources may update them when standards change. You can use theMeans Test calculators maintained by the nonprofit organizationUpsolve with confidence, as they are always updated when states update their Means Test standards.

What Happens if I Fail the Means Test for Alaska?

There is no question that Alaskans are tough, resilient people. If you learn that you don’t  meet the eligibility requirements for Chapter 7 under the bankruptcy Means Test for Alaska, your toughness and resilience will come in handy as you seek alternative debt relief solutions.Alaska bankruptcy comes in several forms and you may benefit fromspeaking with an experienced attorney about filing under a different chapter. For example, your household may be a good candidate forChapter 13 bankruptcy. This process will allow you to restructure your debts so that you have a much lower monthly debt payment. You can then benefit from a bankruptcy discharge after making lower monthly payments for 5 years. Oftentimes, making debt more manageable is nearly as helpful as eliminating it outright. Once your debt payments are much easier to handle, you and your family can focus on building a strong financial foundation for the future and rebuilding your credit.