Georgia Statement of Current Monthly Income and Disposable Income Calculation for Use in Chapter 13 — Post 2005 is a crucial document required for individuals filing for Chapter 13 bankruptcy in the state of Georgia. This statement helps assess the debtor's ability to repay their creditors over a designated period of time. It consists of detailed information regarding the debtor's current monthly income and the calculation of their disposable income. The Georgia Statement of Current Monthly Income provides an overview of the debtor's income sources, including wages, salary, commissions, tips, bonuses, rental income, business income, and any other regular sources of funds. This section encompasses all types of income received by the debtor and their spouse, regardless of whether the income is taxable or not. Furthermore, the statement includes information about the debtor's deductions, such as federal, state, and local taxes, Social Security and Medicare taxes, retirement contributions, health insurance premiums, and other necessary expenses. These deductions help determine the debtor's current monthly income, which is a significant factor in determining their eligibility for Chapter 13 bankruptcy. The Disposable Income Calculation section of the statement is used to assess the amount of income the debtor can allocate towards repaying their creditors. It involves subtracting specific allowed expenses and deductions from the debtor's current monthly income to determine their disposable income. These expenses are categorized as necessary living expenses, such as housing, transportation, food, utilities, childcare, healthcare, and education. It's important to note that the Georgia Statement of Current Monthly Income may have specific variations or additional requirements based on local bankruptcy rules or the discretion of the assigned bankruptcy court. However, the overall purpose remains the same — to evaluate the debtor's financial status, income, and ability to meet the repayment obligations under the Chapter 13 bankruptcy plan. In conclusion, the Georgia Statement of Current Monthly Income and Disposable Income Calculation for Use in Chapter 13 — Post 2005 is a comprehensive document that provides an in-depth analysis of the debtor's income and discretionary funds. By accurately determining the debtor's current monthly income and calculating their disposable income, this statement helps establish a fair and feasible Chapter 13 bankruptcy repayment plan tailored to the debtor's financial circumstances.
Georgia Statement of Current Monthly Income and Disposable Income Calculation for Use in Chapter 13 - Post 2005
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The disposable income calculation starts with your gross income. You must also be a wage earner in order to file a Chapter 13. Then, certain expenses are deducted based on an IRS deduction. The deduction is based upon a national average, taking into consideration the metropolitan area you live.
To determine your Chapter 7 bankruptcy income limit, add the last six months of your gross income ? this is what you earned before taxes and other deductions were taken out. Divide that number by six. While that may seem like a waste of time ? why not just take one month instead of adding six, then dividing by six?
If income is less than the median for the prior six months and there is no reason to assume it will soon increase, the test is passed, and the Chapter 7 filing can proceed. The vast majority of applicants pass the test on step one. Those who don't, move to step two.
For a Chapter 13, the ?Chapter 13 Statement of Your Current Monthly Income and Calculation of Commitment Period? (Form 122C-1) tells the court your average monthly income. Your income is compared to the median income for your state, which will assist in calculating your disposable income.
If your total monthly income over the course of the next 60 months is less than $7,475 then you pass the means test and you may file a Chapter 7 bankruptcy. If it is over $12,475 then you fail the means test and don't have the option of filing Chapter 7.
The means test is calculated by comparing the debtor's average income for the past six months (current monthly income), annualized, to the median income for households of the same size in the debtor's state of residence.
Calculation of Current Monthly Income: To begin the means test, debtors calculate their current monthly income, which equates to twice the gross income earned in the six months leading up to the bankruptcy filing.