The bankruptcy means test is a six month look-back at all sources of income used to determine whether or not you can file Chapter 7 bankruptcy. I will normally ask potential clients to provide me with paystubs for this period of time. However, the income that is considered for the means test in bankruptcy goes beyond what is in a regular paystub.
For instance, if you receive cash from an employer, or from sales or your own business, without a paystub, it still counts. If you are a 1099 employee who doesn’t receive a paystub, that counts as well. Gig economy income for jobs such as Uber or Doordash, even if very limited and used to pay bills, must be disclosed. Any income from any employer (in any form) will count towards the means test.
Sometimes, late in the filing process, a client will disclose cash income or one of the situations above. The means test will need to be redone to account for this additional income. If you have any doubt, tell your bankruptcy attorney about the income. It will alleviate problems in the future.
Also, non-employment money can sometimes be counted towards the means test. This would include unemployment compensation, child support, and household contributions. While most people would not think of these sources as “income”, they are for purposes of the test..
VA benefits, it should be noted, do NOT count towards the means test.
If you’re considering filing bankruptcy, call us at 412-414-9366. I would be happy to set up a free consultation to see if filing bankruptcy is an option for you.