What Is The Bankruptcy Means Test in Pennsylvania?

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Written by Attorney Tina Tran.  
Updated July 30, 2019


Pennsylvania is known as “The Keystone State” because it has served a central role in the economic, political and social evolution of the United States. It is therefore not surprising that Pennsylvania bankruptcy laws serve as models for those observed across the nation. However, the process of filing for Chapter 7 bankruptcy in Pennsylvania does have its quirks. If you are thinking about filing for bankruptcy in Pennsylvania, you are taking a brave, responsible step towards stabilizing a challenging financial situation. You may be able to successfully navigate the Chapter 7 process without formally hiring an attorney. In order to move forward successfully, you will benefit from learning a bit about Pennsylvania’s unique bankruptcy process. For example, the bankruptcy Means Test in Pennsylvania only allows individuals and families to file for Chapter 7 bankruptcy if their income rests below a certain amount. The larger a household is, the more income it is allowed to take in before it no longer qualifies for Chapter 7 bankruptcy protections. If your household exceeds certain income limits, a local attorney may be able to help you explore alternative debt management options designed for your unique circumstances.

Pennsylvania Median Income Levels

Pennsylvania Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
Household SizeMonthly IncomeAnnual Income
1$4,550.42$54,605.00
2$5,628.33$67,540.00
3$6,989.00$83,868.00
4$8,609.67$103,316.00
5$9,359.67$112,316.00
6$10,109.67$121,316.00
7$10,859.67$130,316.00
8$11,609.67$139,316.00
9$12,359.67$148,316.00
10$13,109.67$157,316.00

Discharge in Bankruptcy for Pennsylvania

Chapter 7 bankruptcy is commonly referred to as “discharge bankruptcy” because it allows filers to be relieved of many of their debts. This process is different from Chapter 13 bankruptcy in which debt is generally just reorganized. Discharge is a powerful process, as it can help you to “wipe the slate clean” in regards to most or all of your current debts. However, it is important to note that Pennsylvania bankruptcy discharge rules may require you to sell some of your property in order to settle some of your existing debt, if your household income is relatively high. However, most people who have less than $10,000 worth of property are able to keep all of it. In addition, Pennsylvania bankruptcy law allows all filers to keep unlimited amounts of certain kinds of personal property. This means that certain possessions, such as your favorite books and your prized Eagles or Steelers jerseys, will not need to be sold in order for you to successfully file for Chapter 7 bankruptcy in Pennsylvania.

Pennsylvania Means Test Calculator

If you are interested in filing for Chapter 7 bankruptcy in order to discharge much or all of your existing debt, you may benefit from evaluating your household income by using a Means Test calculator. This tool can help you to determine if you qualify for Chapter 7 bankruptcy protections in Pennsylvania. Not all such calculators you may find online are accurate, so it is important to use one that is both up-to-date and applies specifically to your state of residence. Too often, individuals use generic or out-of-date Chapter 7 Means Test calculators and are therefore unable to make informed decisions about their debt management situations. Upsolve maintains an accurate and up-to-date Pennsylvania Means Test calculator and similar means test calculators for other states. Once you access this Pennsylvania-specific tool, you will be able to obtain a strong sense of whether your household income allows you to qualify for Chapter 7 bankruptcy discharge. At that point, you can consider whether filing for a discharge of your debts is your best option. If and when you are ready to take the next step towards financial well-being, Upsolve can help you navigate your legal needs moving forward.

What Happens If I Fail The Means Test for Pennsylvania?

Pennsylvania’s state tourism slogan is, “Pursue Your Happiness.” This is a task often easier said than done. Life is complex and debt can overwhelm any individual’s pursuit of happiness. Thankfully, numerous legal tools exist that can help you regain financial health and prosperity. If you “pass” the Pennsylvania Means Test, you may be able to take advantage of Chapter 7 bankruptcy discharge. But even if you “fail” the Means Test, you may still qualify for numerous legal resources. It is therefore important to understand that you may be able to “pursue your happiness” in regards to your finances, even if your household income is so high that you don’t qualify for Chapter 7 bankruptcy. For example, you may be able to file for Chapter 13 bankruptcy, which could allow you to reorganize your debt in ways that make it truly manageable. Pennsylvania bankruptcy law also contains certain exceptions, which could mean that even if you fail the Means Test at first glance, a local attorney could clarify your situation so that you could still discharge your debts. In seeking solutions to your financial situation, you are exercising courage and determination. With some experienced legal assistance, you will find solutions. 



Written By:

Attorney Tina Tran

LinkedIn

Tina Tran is the managing bankruptcy attorney for Upsolve, the largest consumer bankruptcy non-profit in the United States. She received her Juris Doctorate degree and Certificate in Advocacy from Loyola University Chicago School of Law. She is licensed to practice law in Illinoi... read more about Attorney Tina Tran

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