Is there a means test for Chapter 11 bankruptcy?

Yes, there is a means test for Chapter 11 bankruptcy, which is applicable in Florida. A debtor filing for Chapter 11 bankruptcy must demonstrate that their income is below a certain amount – the Florida median family income – in order to qualify for Chapter 11 bankruptcy relief. This is known as the ‘means test’. The means test is designed to ensure that only debtors with genuine financial difficulty can benefit from Chapter 11 bankruptcy relief. To qualify, the debtor must first determine their average monthly income during the six months prior to filing. This is done by taking the amount earned in the six months before filing and dividing it by six to give the average monthly income. Once the average monthly income is calculated, it is compared to the Florida median family income. If the debtor’s income is greater than the median income, the debtor cannot qualify for Chapter 11 bankruptcy relief and must pursue another form of debt relief. However, if the debtor’s income is less than the median family income, the debtor can qualify for Chapter 11 bankruptcy protection. In short, if a debtor in Florida wishes to file for Chapter 11 bankruptcy, they must first prove that their average monthly income is less than the Florida median family income in order to qualify. This is done through a means test.

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Is there a means test for Chapter 11 bankruptcy?

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