What Is the Bankruptcy Means Test in Delaware?

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Written by Karra Kingston, Esq.  
Updated July 31, 2019

Congress passed the Bankruptcy Reform Act in 2005 to stop people who could afford to pay back at least some of their debt from filing Chapter 7 bankruptcy. At that time, there was a concern that the bankruptcy system was being abused by people who made “too much money” and could otherwise afford to pay back some or all of their debts. To prevent people from filing a Chapter 7 bankruptcy, Congress created the Chapter 7 Means Testas a method to help people demonstrate that they are not abusing the system. Congress wanted to make sure that people filing Chapter 7 cases were those who truly needed such relief. To file a Chapter 7 bankruptcy you will need to pass the bankruptcy Means Test in Delaware. There are two ways to pass the test. First, you can qualify based on income limits if your current monthly income is lower than the median income in Delaware for a family of your size. If your income is higher than the median income, you should not feel too bad because you’re actually better off than most! If you don’t qualify under this initial threshold, you can complete the second part of the Chapter 7 Means Testcalculation, which considers your income and reasonable monthly expenses. If at the end of this calculation you have no or little disposable income left to pay your debts, you pass the bankruptcy Means Test in Delawareand qualify to file a Chapter 7 bankruptcy. 

Delaware Median Income Levels

Delaware Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
Household SizeMonthly IncomeAnnual Income
1$4,631.50$55,578.00
2$6,053.67$72,644.00
3$7,048.67$84,584.00
4$8,552.08$102,625.00
5$9,302.08$111,625.00
6$10,052.08$120,625.00
7$10,802.08$129,625.00
8$11,552.08$138,625.00
9$12,302.08$147,625.00
10$13,052.08$156,625.00

Discharge in Bankruptcy for Delaware 

When the Bankruptcy Court enters your order of discharge this means that you can finally move on and put most of your bills in the past! This is the point in the bankruptcy process when your debts are eliminated, and you are no longer personally obligated to pay them. This order of discharge is why you filed your bankruptcy case in the first place! Keep in mind that certain types of debts, like child support, are non-dischargeable, and you remain obligated to pay them. For most people, however, the bulk of their debt is general unsecured debt, like credit cards and medical bills, so bankruptcy can help them get back on their feet. To obtain your Delaware bankruptcy discharge, it’s important to file all of your paperwork, attend your Meeting of Creditors and cooperate with your bankruptcy Trustee, and take the post-filing financial management class. You can expect to receive your Delaware bankruptcy discharge approximately 60 days after your creditors’ meeting. After the Court issues your discharge your case will close once the Trustee is done reviewing everything. It’s important to keep your discharge notice with your important paperwork just in case you need to refer back to it in the future. A discharge is not automatically granted. Courts can deny your discharge for many reasons. Some reasons Courts deny a discharge is for failing to provide the required documents or information, purposefully destroying or altering information so it can’t be used to analyze the debtor’s finances, hiding information or property, fraud or lying. It’s important that you are honest so that the discharge in your Delaware bankruptcy case is granted without question. 

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Delaware Means Test Calculator

If you don’t immediately qualify for a Chapter 7 bankruptcy because you seemingly make too much money, you are in a better financial space than most. You will need to go through the second part of the Chapter 7 Means Test analysis to determine whether you qualify for Chapter 7 relief. The Court will look into your finances and reasonable monthly expenses to ensure you qualify. If your expenses are unreasonable the Court can deny your request for Chapter 7 relief and convert your case to a Chapter 13 or dismiss it altogether. If you do an online search you can find many Means Test Calculators to help you with your calculations. It’s important to use a Delaware Means Test calculator that is accurate and up-to-date. Numbers change periodically and if you use an outdated calculator you may think you qualify when you don’t! The Upsolve Means Test calculator is current to the day for Delaware and all other states, so you can be at peace knowing you are using the most accurate information. The ability to file your Delaware bankruptcyunder Chapter 7 of the Bankruptcy Code depends on the result reached by the Delaware Means Test Calculator, so it’s important that you always double check your figures and make sure that you are using the correct calculator. Upsolve can help ensure that your case is successful from filing to getting your discharge as we can walk you through the process step by step

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What Happens If I Fail The Means Test for Delaware?

If you fail the Chapter 7 Means Test, it’s important not to panic! First, it’s a good idea to go back through the full Means Test calculation and confirm that all of your information is accurate and complete. Make certain that you didn’t forget expenses. Even forgetting one expense can make a difference as to whether you qualify for relief under Chapter 7. You can also look ahead, in case there are any major changes to your life coming soon. Are you expecting a baby? What if you are considering a separation or divorce? It could be that you don’t qualify for a Chapter 7 Bankruptcy in your current situation, but you might qualify under the bankruptcy means test in Delaware later on if your financial situation or family size changes. Perhaps your work is seasonal, and the bulk of your annual income is made only during the summer months. If so, it can make sense to wait a few months after your busy season is over. Check out Upsolve’s bankruptcy guide for Delaware so you can prepare for your Delaware bankruptcy. If, after re-checking your figures and seeing no life changes in the near future, you still don’t qualify, you should speak with a bankruptcy lawyer. A bankruptcy lawyer can review your information and make sure you didn’t miss anything. They can also explain the possibility of filing a Chapter 13 bankruptcy as another way to get relief. Bankruptcy lawyers usually give free consultations that can help you better understand your financial situation. Even if you don’t want to go into a Chapter 13 repayment plan, bankruptcy lawyers may have other options to help you get relief. 

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