One of my clients recently told me that she and her husband make about $105,000 per year. I remember when that was a lot of money. It still is for many people.
My client and her husband also have four kids who are dependents. When she asked if they might qualify for Chapter 7 relief under the Bankruptcy Code, I told her that we would look at all of the circumstances.
Too Much for Bankruptcy?
You may be surprised to hear their combined income of $105,000 did not disqualify them from filing under Chapter 7. In fact, being a six-person family, they could make as much as $110,445 and still qualify under the income provisions of the Bankruptcy Code.
How can that be?
Qualifying for Bankruptcy
One of the first qualifiers for filing for Chapter 7 relief is income, or how much money comes into your household during the year. When income is considered, so is family size. Under the bankruptcy guidelines as of April 1, 2018, a family of two is limited to an income of $63,687 for a year, except under special circumstances.
Don’t assume that just because your income may be higher than these guidelines that things are hopeless. I did mention that, under some circumstances, you may make more money than the guideline amounts and still qualify for Chapter 7.
Income is not an issue to filing a Chapter 13 bankruptcy, a reorganization where you might only have to pay a small percentage of your debt if other circumstances are present. The bottom line is, if you make a good income but still have debt issues, all is not lost. It’s important to contact Steidl & Steinberg for a free consultation to discuss your options. You need to act quickly to prevent a difficult financial situation from becoming even worse.