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Means Testing

Census Bureau, IRS Data and Administrative Expenses Multipliers

(Cases Filed Between November 1, 2009, and March 14, 2010, Inclusive)

 

Section I. Census Bureau Data

In Part III of Bankruptcy Form 22A and Part II of Bankruptcy Form 22C, debtors are instructed to enter the “Applicable median family income.” This information is published by the Census Bureau according to State and family size, and the data is updated each year. In addition, pursuant to 11 U.S.C. § 101(39A)(B), the data on this Web site will be further adjusted early each calendar year based upon the Consumer Price Index for All Urban Consumers (CPI).

The following link provides the median family income data published in September 2009, reproduced in a format that is designed for ease of use in completing these bankruptcy forms.

Median Family Income Based on State/Territory and Family Size

Available for download in MS Excel format. [XLS - 27 kb]

Section II. IRS Data & General Information for Completing Bankruptcy Forms

In Part V, Subpart A, of Bankruptcy Form 22A and Part IV, Subpart A, of Bankruptcy Form 22C, debtors are instructed to enter “National Standards” and “Local Standards.” This information is updated annually by the IRS. The following links provide the appropriate data, reproduced in a format designed for ease of use in completing these bankruptcy forms.

Note: The IRS expense figures posted on this Web site are for use in completing bankruptcy forms. They are not for use in computing taxes or for any other tax administration purpose. Expense information for tax purposes can be found on the IRS Web site.

1. General Information Regarding IRS Collection Financial Standards

The following summary describes the IRS's Collection Financial Standards. This information can also be found on the IRS Web site.

Collection Financial Standards are used to help determine a taxpayer’s ability to pay a delinquent tax liability. Allowable living expenses include those expenses that meet the necessary expense test.The necessary expense test is defined as expenses that are necessary to provide for a taxpayer’s (and his or her family’s) health and welfare and/or production of income.

National Standards for food, clothing and other items apply nationwide. Taxpayers are allowed the total National Standards amount for their family size, without questioning the amount actually spent.

National Standards have also been established for minimum allowances for out-of-pocket health care expenses. Taxpayers and their dependents are allowed the standard amount on a per person basis, without questioning the amount actually spent.

Maximum allowances for housing and utilities and transportation, known as the Local Standards, vary by location. In most cases, the taxpayer is allowed the amount actually spent, or the local standard, whichever is less.

2. National Standards: Food Clothing & Other Items. National Standards are published by the IRS, and the table includes five (5) subcategories of expenses and their combined total. The National Standards are published by family size.

Part V, Subpart B, on Form 22A and Part IV, Subpart B, on Form 22C allow for a qualifying debtor to claim an additional food and clothing ("apparel and services") expense if the debtor’s average monthly food and clothing expense exceeds the combined allowances for those two subcategories, not to exceed five (5) percent. For purposes of these bankruptcy forms, the "Food" and "Apparel & services" subcategories have been combined and are provided as a separate line item, which is displayed together with the five (5) percent calculation of those two subcategories combined.

National Standards:  Food, Clothing & Other Items (General Information can be found on the IRS Web site)

National Standards: Food, Clothing & Other Items (Data)

Available for download in MS Excel format. [XLS - 18 kb]

3. National Standards: Out-of-Pocket Health Care Expenses. National Standards for Out-of-Pocket Health Care expenses are published by the IRS.

National Standards: Out-of-Pocket Health Care Expenses (General Information can be found on the IRS Web site)

National Standards: Out-of-Pocket Health Care Expenses (Data)

Available for download in MS Excel format. [XLS - 15 kb]

4. Local Standards. The Local Standards are published by the IRS and consist of two primary expense categories, "Housing and Utilities" and "Transportation."

Local Standards (General Information can be found on the IRS Web site)

a. Local Housing and Utilities Expense Standards - By State, County, and Family Size. The Housing and Utilities Standards are published by the IRS by State (including Guam, the Northern Mariana Islands, Puerto Rico, the Virgin Islands, and the District of Columbia), county, and family size. For purposes of these bankruptcy forms, the Housing and Utilities Standards are provided in two components -- non-mortgage expenses and mortgage/rent expenses.



Available for download in MS Excel format. [XLS -24.1 Mb]

b. Local Transportation Expense Standards - By Metropolitan Statistical Area and Census Region. The Transportation Standards are published by the IRS in two components. The Operating Costs & Public Transportation Costs component of the Transportation Standards is published by number of cars and by Metropolitan Statistical Area (MSA) and Census Bureau region. In order to use the data, you must determine in what Census Bureau region your state is located and whether your county is located in a MSA. The Ownership Costs component of the Transportation Standards is published on a national basis, by number of cars. This information, reproduced in a format designed for ease of use in completing these bankruptcy forms, is available at the following link.

NOTE: The IRS does not currently publish transportation standards for Guam, Puerto Rico, the Northern Mariana Islands, or the Virgin Islands. For purposes of these bankruptcy forms, the Virgin Islands and Puerto Rico are included with the Northeast Census Bureau Region, and Guam and the Northern Mariana Islands are included with the West Census Bureau Region.



Available for download in MS Excel format. [XLS - 31 kb]

Section III. Administrative Expenses Multipliers

11 U.S.C. § 707(b)(2)(A)(ii)(III) allows a debtor who is eligible for chapter 13 to include in his/her calculation of monthly expenses the actual administrative expenses of administering a chapter 13 plan in the judicial district where the debtor resides.

The Executive Office for U.S. Trustees issues the schedules of actual administrative expenses which contain, by judicial district, the chapter 13 multiplier needed to complete Official Bankruptcy Forms 22A and 22C (Statement of Current Monthly Income and calculations). Form 22A is the form most chapter 7 debtors will complete and the multiplier is entered on Line 45.b; Form 22C is the form most chapter 13 debtors will complete and the multiplier

Schedules of Actual Administrative Expenses of Administering a Chapter 13 Plan (as Required by 11 U.S.C. § 707(b)(2)(A)(ii)(III))

Available for download in MS Excel format. [XLS - 27 kb]

Note:

The original source for the State Median Family Income is the Census Bureau.

The original source for the National and Local Standards is the IRS.

To report any differences between the data on these pages and their original source, please e-mail: ust.mt.help@usdoj.gov.

 

Thursday, February 21, 2013 4:50 PM