Once again, the means test figures for median income are changing as of November 1, 2010. Unfortunately, for a lot of jurisdictions, it means that the amount of income that the debtor can have before being forced into a Chapter 13 Bankruptcy is going to decrease.
Through October 31, 2010, a single debtor in New York could have $46,320 in income and still be able to file Chapter 7 Bankruptcy. Starting November 1, 2010, that figure is dropping to $45,548. Similar declines will take place for all family sizes. The comparison of the existing and new income limits is below.
Old Income Limits
FAMILY SIZE
1 EARNER 2 PEOPLE 3 PEOPLE 4 PEOPLE *
$46,320 $57,902 $69,174 $82,164sa
New Income Limits
FAMILY SIZE
1 EARNER 2 PEOPLE 3 PEOPLE 4 PEOPLE *
$45,548 $56,845 $67,292 $82,587
* Add $7,500 for each individual in excess of 4.
While the income limit for a family of four has gone up slightly, for smaller families, the income limit has declined. For a family of three, the income limit will decline by nearly two thousand dollars.
The reason for a reduction in the median income is the decline in the American economy. Since the economy is down, employers pay less and employees to earn less. As a result, the American median family income has dropped once again. As the income declined, so do the income limits for Chapter 7 Bankruptcy. The unfortunate problem resulting from the recession is that as debtors make less money and have more financial problems, it becomes harder for them to qualify for Chapter 7 Bankruptcy.
If you are contemplating filing Chapter 7 Bankruptcy or Chapter 13 Bankruptcy, or are dealing with debt problems in Western New York, including Rochester, New York, Canandaigua, Brighton, Pittsford, Penfield, Perinton, Fairport, Webster, Victor, Farmington, Greece, Gates, Hilton, Parma, Brockport, Spencerport, LeRoy, Chili, Churchville, Monroe County, Ontario County, Wayne County, Orleans County, Livingston County, and being harassed by bill collectors, and would like to know more about how bankruptcy may be able to help you, contact me today by phone or email to schedule a FREE initial consultation with a Rochester, NY, bankruptcy lawyer.