The median income for California families used in bankruptcy’s infamous means test has fallen. The change is based on new U.S. Census Bureau figures.
Those filing bankruptcy whose income is below the median are excused from the full-blown means test. In fact, most individuals and families who are above median also qualify for bankruptcy, they just have to jump through more hoops to prove their entitlement.
Until November 1, 2011, the median figures for Bay Area households based on size is as follows:
- 1 person – $48.009
- 2 people – $62,970
- 3 people – $68,670
- 4 people – $78,869
For cases filed on or after November 1, the median incomes are
- 1 person $47,683
- 2 people $61,539
- 3 people $66,050
- 4 people $74,806
The data for each state, now and next month, is found on the U.S. Trustee’s site.
If you are preparing to file, consider immediately how these changes effect you. The bankruptcy process is easier if you are below median. There’s a $4,000 difference for a household of four depending on where your bankruptcy case is filed on Monday, Oct.31 or Tuesday, November 1.
Then we have to ask ourselves, is this any way to run a legal system?
Image courtesy of luxpim