If you have primarily consumer debts and are considering filing bankruptcy, you will have to subject yourself to one of the most convoluted systems of bureaucracy this side of the Atlantic: the Means Test in Chapter 7 or Chapter 13.

For brevity’s sake, the Means Test determines your eligibility to file a Chapter 7 bankruptcy.  In a Chapter 13 case, the Means Test will determine how long your payment plan will be and is one way in which the court decided how much your plan payments are going to be.

One of the requirements in filling out the Means Test is to calculate the average of ALL income received 6 months prior to filing your petition. And by ALL, it really does mean EVERYTHING.

For instance, if you sold your stash of gold coins prior to filing bankruptcy and received $20,000 for them, that income would be included in your Means Test calculation. If your income listed on the Means Test is above a certain threshold, the court will consider your filing a presumptive abuse of the bankruptcy process because, according to Congress, you had the “means” to pay back your debts.

This presumption CAN be overcome. For example, if you received a large cash gift to pay for ongoing medical treatment and it was clear that the gift was merely a one-time, non-recurring gift, that would be considered income that would be disclosed on the Means Test. If that income pushed you a bit above the threshold into presumptive abuse territory, it is highly probable that a bankruptcy attorney with a firm grasp of the law would be able to overcome that presumption and keep your case in a Chapter 7 or keep your Chapter 13 plan payments down to a minimum.