As of May 1, 2012, it is slightly easier for Oklahoma residents to qualify for Chapter 7 bankruptcy, as the income requirements for the “Means Test” have increased for all household sizes. Prior to the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) of 2005, an individual considering filing for bankruptcy would decide whether to file Chapter 7 bankruptcy (liquidation) or Chapter 13 bankruptcy (consolidation) in Oklahoma. Since the law was passed in 2005 though, determining which chapter an individual files under in Oklahoma depends largely on his or her income. In short, individuals who wish to file Chapter 7 bankruptcy in Oklahoma must first pass the Means Test, which compares the person’s average income to the state’s median income, before they are eligible to do so. If you are considering filing Chapter 7 or Chapter 13 bankruptcy in Oklahoma, consult our knowledgeable bankruptcy attorneys at Oklahoma Legal Center to discuss your best course of action.
New Means Test Figures for Oklahoma Bankruptcy Qualification
Previously, the income requirements for Chapter 7 eligibility mandated that one-person households with an average income of $36,884, two-person households with an average income of $49,711, three-person households with an average income of $54,135, and four-person households with an average income of $64,037 (add $7,500 for each individual in the household over four), automatically qualified to file bankruptcy under Chapter 7. The new median income figures for households in Oklahoma are as follows:
- 1-person household: $38,649
- 2-person household: $49,838
- 3-person household: $55,015
- 4-person household: $62,301
(Add $7,500 for each individual in a household over 4)
Under Oklahoma law, if gross household income falls below these new numbers, an individual or married couple passes the Means Test and automatically qualifies to file Chapter 7 bankruptcy in Oklahoma. A person whose household income exceeds these figures may still be eligible for Chapter 7 bankruptcy if he or she has enough allowable expense deductions to offset his or her above-median income, or if the projected amount of disposable income would pay less than 25% of the total unsecured debt. For those Oklahoma residents who fail the Means Test and therefore do not qualify for Chapter 7 bankruptcy, Chapter 13 bankruptcy may still be a viable option.
Contact Our Bankruptcy Attorneys in Oklahoma City
Filing for bankruptcy in Oklahoma is a big decision, but it can help you finally release yourself from the overwhelming burden of unpayable debt. With the new income requirements for the Means Test, Oklahoma residents may find it a little bit easier to qualify for Chapter 7 bankruptcy, which allows debtors to eliminate most unsecured debts by giving up all “non-exempt” property. If you are considering filing for bankruptcy in Oklahoma under Chapter 7, contact our experienced bankruptcy attorneys at Oklahoma Legal Center today. Our law firm is located in Oklahoma City and our lawyers are familiar with Oklahoma bankruptcy laws and the steps required to file for bankruptcy in Oklahoma. With the help of our attorneys, Oklahoma residents can relieve themselves of their debt and finally start fresh.