Wesley D. Wornom, Attorney at Law, represents people throughout Northern Virginia including residents of Prince William County, Woodbridge, Dale City, Lake Ridge, Occoquan, Montclair, Dumfries, Quantico, Quantico Marine Base, Manassas, Manassas Park, Gainesville, Haymarket, Catharpin, Bristow, Stafford, Fairfax, King George, Caroline, Fredericksburg, Spotsylvania County, Loudoun County, and Fauquier County.

The information you obtain on this site is not, nor is intended to be, legal advice. You should contact an attorney for individual advice on your own situation.

Bankruptcy After the 2005 Bankruptcy Act

In 2005, under tremendous pressure from the credit card industry, Congress passed a so-called "Bankruptcy Reform and Consumer Protection Act." The clear intention of the changes in the law was to make bankruptcy more difficult, both to qualify for filing and the actual filing itself. At Wesley D. Wornom, Attorney at Law, we understand how this law, and we want you to know that we can help. We file both Chapter 7 and Chapter 13 Bankruptcies.

Means Testing

Of all the changes in the 2005 bankruptcy law, the most significant is "means testing." Prior to 2005, there was not any income limitation to file bankruptcy and when the bankruptcy trustee or the courts evaluated whether a debtor could file a Chapter 7 or a Chapter 13 Bankruptcy, the actual living expenses of the debtor and his or her family were used. After the 2005 bankruptcy law, this is no longer true.

If a family has income above the "median household" income for their county and state, then in order to qualify for a Chapter 7 bankruptcy, they must pass "means testing." In Virginia, the following amounts are median income levels based upon family size as of January 2009. 1 person - $49,689, 2 persons - $65,342, 3 persons - $73,191, 4 persons - $85,769. If your family's income is below this amount, then you do not need to pass means testing. If your family's income is above this amount, then amounts determined by the IRS, not your actual living expenses are subtracted from your gross income less your actual taxes withheld. Your income is determined by adding up the past six months' income and dividing by 6. Therefore, if you have been out of work, and need to file bankruptcy, you should consider filing sooner than later, in order for your income used for means testing to be lower. On the other hand, if you have just been laid off, it might be better to wait six months before filing a Chapter 7 or a Chapter 13 bankruptcy. Many persons with incomes above the median household income still qualify for Chapter 7, particularly if they have high amounts of secured debts (car loans, house loans, etc.). Also, the new bankruptcy law allows persons actually making charitable contributions to continue those contributions. You must have proof of an established practice.

At Wesley D. Wornom, Attorney at Law, we know how to help you and will give you the personal attention your case needs to put you on the right track to being debt free.