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Bench & Bar of Minnesota is the official publication of the Minnesota State Bar Association.

Means Testing

If you have a client or opposing party who is considering filing a Chapter 7 (liquidation) bankruptcy, don’t forget about the “means test.”  Complex calculations will determine eligibility for a Chapter 7 bankruptcy.  New numbers for the means test went into effect on November 1, 2010, which make it slightly more difficult for many people to qualify for Chapter 7.  A Chapter 7 may be dismissed or converted to a Chapter 13 (reorganization) if the debts are “primarily consumer debts.”  11 U.S.C. §707(b)(1).  The opposite can be true.  If the debts are primarily business debts, there will not be a dismissal or a conversion.

Susan Dickel Minsberg

Law Office of Susan Dickel Minsberg

St. Paul

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