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