Determining Your Eligibility for Chapter 7 Bankruptcy in Oklahoma

Who gets to do chapter seven? Well, mainly it comes down to how much money do you make versus your expenses. So the IRS has standards that they come out with so many times a year saying this is what we consider basically the hardship line for a family of a certain size. So for example, for one person between 40 and 50,000. Add about 10,000 for each number of people. 2, 50 to 60. 3, 60 to 70, and so forth, and on up. And depending on inflation and changes in the economy, then that’s going to be updated.

So first thing, you take your gross income for everyone that earns in your household. So what’s a household? Well, that’s an important thing to think about for chapter seven. If it’s you and your wife, or you and your husband and your grown kid, maybe they have a separate household, maybe they pay you a little rent, so you consider that income from them as rent and you’ve got a household of two, just you and your wife. Your kiddo has a separate household. If they’re working, that may work out better for you, legitimately, in terms of whether you qualify. With the three people pooling their income, you might be over what they call the means test cap. That’s that for three people, we’re looking at 60 to 70,000. Whereas if you have a household of two, even with the little rent they pay you, maybe you are under, maybe your kid makes pretty good money and you know that income doesn’t help. But maybe if they don’t make anything and you make more, including them as part of your household and including their income puts you under the cap.

So these are the kind of things that you want to think about. So if you’re under, that means test cap. You’re good. If your gross is under that, you qualify. If you’re above, then we go into a calculation. Do your expenses bring you back down? Do you have a high mortgage? Do you have a high car payment? Do you have unusual expenses that go beyond what the government normally thinks you should have for those expenses? If you’ve got those and they pull you down back under that cap, then you qualify. So that’s basically how it works. And you can only do chapter seven once every eight years. So if you’ve done it in the last eight years, and filed the filing date of the previous case, then you can’t do it. So that’s who can do a seven.