An examination of income and expenses, called a "means test" is required to determine whether an individual qualifies to file a Chapter 7 bankruptcy in Iowa. This is a calculation based on a six (6) months of paycheck stubs or other proof of income to determine the average of your (and your spouse’s) gross income, deductions and net income and average normal, necessary and reasonable living expense given your family size.
Family of one: $41,933
Family of two: $56,960
Family of three: $64,216
Family of four: $74,514
Generally speaking, if your gross average income is higher, given your family size, then median income you do not automatically qualify for a Chapter 7. However, what to count as income and who to count as "family" are issues only an attorney can determine. Most importantly, you may very well qualify to file a Chapter 7 bankruptcy in Iowa even if your gross income exceeds the median depending on the other factors including deductions and expenses.
There are various rules, guidelines and charts required by the Bankruptcy Code to be used in determining whether any one individual (or jointly with a spouse) will qualify to file a Chapter 7. This analysis is quite involved and requires an intimate knowledge of the specific guidelines and rules and the local practices of Iowa bankruptcy trustees. Although there are available on the internet "means test" charts and programs that you can explore and use, I recommend caution in thinking that using these programs will accurately determine whether or not you actually qualify or are disqualified to file a Chapter 7 bankruptcy in Iowa. It is strongly recommended that you allow an experienced Iowa bankruptcy attorney to accurately calculate the "means test" to determine whether or not you qualify, based on your income, for a Chapter 7 bankruptcy. If you do not, you can always explore the Chapter 13 repayment plan option.
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