Georgia’s median income matters to bankruptcy filers because it is a significant factor in determining whether or not you qualify for Chapter 7 bankruptcy.
Income Below the State Median
The Bankruptcy Code regulates who is eligible for bankruptcy relief. If your net income (based on the six months before filing for bankruptcy) falls below the state median for your household size, then you automatically qualify for Chapter 7 bankruptcy. Because there is no “presumption of abuse,” below-median debtors do not have to run the means test.
Income Above the State Median
If your net income is above the state median for your household size, then you must run the means test to determine whether or not you qualify for Chapter 7 bankruptcy. The means test is a review of your income minus allowable expenses. The allowable expenses in the means test are calculated based on certain of your actual expenses as well as standard pre-determined expenses. An experienced bankruptcy attorney can help you navigate through the means test.
Many people who file for Chapter 7 bankruptcy earn above the median income. Your income alone does not determine whether or not you qualify for Chapter 7, it determines whether or not you have to run the means test.
Georgia’s Median Income
The median household income in Georgia (as of May 1, 2018) is:
- Household of One: $46,104
- Household of Two: $59,606
- Household of Three: $67,304
- Household of Four: $80,038
- Households of more than four: add $8,400 for each individual in excess of four.
Note that the Census Bureau Median Family Income By Family Size is updated regularly on the first of April, May, and November of each calendar year. Please check here for the most up-to-date median family income by state.
Filing For Bankruptcy Protection
Individuals and married couples may file either Chapter 7 or Chapter 13 bankruptcy. Both chapters offer many of the same benefits, though there are significant differences between what these two chapters offer and how they operate.
If you do not qualify for Chapter 7 relief you may still be able to qualify for Chapter 13 bankruptcy. In fact, you may be better served by the additional benefits offered by Chapter 13, like the ability to catch up on missed mortgage or car payments.
When we meet for a free consultation we will go over the pros and cons of the various chapters and help you determine which chapter is best for you. Our goal is to ensure you understand the different chapters of bankruptcy and how filing will affect you and your family.
We are a debt relief agency. We help people file for bankruptcy relief under the U.S. Bankruptcy Code.