Why does my household size matter?

Your household size determines the median income “cutoff” that will be used to determine whether you must take the “means test.” If your gross income for the past six months was less than the cutoff for your household size, you have cleared that hurdle on the way toward a chapter 7. If you are over the cutoff, you must take the means test. The means test deducts from your past six months’ gross income certain permitted expenses and allows certain additional expenses to be taken into consideration. The resulting figure will determine whether you qualify for a chapter 7 or must file a chapter 13.

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