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Will I be able to declare Chapter 7 Bankruptcy in San Diego with a yearly salary - before taxes - of $125000.00?

San Diego, CA |

Married, 3 children under one roof, step-child and spouse occupying "in-laws" apartment on property and perhaps one step-child returning home from school to stay; until further notice. Currently rent our property, lost (walked away) a home in MI in 2009 (first and second notes on it), one auto loan, one student loan (wife), less than $5K in medical bills, credit card debt somewhere between $30 and $50K, no chattel beyond jewelry less than $10K, approx. $9K in one 401K, no tax issues, no support issues, no legal issues.

Attorney Answers 4


Short answer: probably not.

Slightly longer answer: The means test is the gatekeeper to Chapter 7. It's not clear that you pass the means test, and missing is whether your wife is employed or not, making your income even higher than your comfortable salary.

The safe answer is, probably not. While I have helped people who earn high incomes like you file Chapter 7, legally and ethically, you do not seem to fit that fact pattern. You have only one secured debt, no priority debt, no court-ordered domestic support. It certainly would seem that you have disposable income at the end of the month, after your reasonable expenses were paid. Of course, I could be wrong.

Chapter 7 is really intended for those who have no ability to repay their debts. While you have a somewhat large household, the burden will be on you to show that you really cannot afford to repay your debts in a Chapter 13 bankruptcy. This needle can be thread, but again, the starting place with these facts is, probably not.

Sit down and meet with an attorney. Some will perform the means test for you for a small fee. It's just a form, but like a tax return and other forms, completing it to maximize your chances of success requires experience and know-how. You might qualify for filing Chapter 7 bankruptcy; you might not.

If you don't qualify, consider negotiating and settling your debts. Also consider Chapter 13, which provides a structured means to pay some or all of your debt back, but not necessarily all. Which is best for you? Meet with an attorney locally to go over your options, learn the pros-cons of each one, and get a suggestion for which is best for you.

Good luck to you, and do remember to mark the "best answer." The attorneys at Avvo are not compensated, and Avvo keeps track on the feedback we receive. Thanks again.

This answer does not create an attorney-client relationship between you and I. I am not your attorney unless we both sign a written contract that describes our relationship and terms of the representation. Any information provided to you here is not a substitute for the advice you need to pursue any legal matter. I advise you to retain the services of a local attorney before taking any legal action in this matter.

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Original Poster here: To add to my dubious description: Wife is not employed (Type II diabetic w/ loss of feeling in feet) and two of my sons are Special Needs and I "make too much money to get assistance" with either. Living in SoCal, our SDGE utility bill last month was over $900, our minimum auto insurance on 2 vehicles is close to $300 a month and we have an AVERAGE monthly prescription co-pay of at LEAST $120 a month. I should have been clearer, but the credit card debt is across at least 6 different cards. For at least the last 6 months, we have been "keeping the lights on" (literally) with credit. And, a summons was delivered to the door yesterday for "less than $25K". I think we're sunk ...

Hale Andrew Antico

Hale Andrew Antico


Thank you for your kind response, and additional information. You've demonstrated that the standard lawyer response "it depends" has a purpose. Most people don't pay $900/mo for electric or have high medical bills. Are those reasonable? Are they enough to make a Chapter 7 viable? You really need to meet with an attorney for a free consultation. Chapter 13, if necessary, will force creditors to accept whatever paltry payment you can make after reasonable expenses. But, as with most things, your mileage may vary.


I have to give you that most frustrating answer that we attorneys rely on when we do not have all the facts, and it is "it depends". You have laid out some of your assets and possible your household size here but it is difficult to answer this question without more information. Your monthly expenses also have an impact on which Chapter you can file. You should take advantage of a free consultation with a competent bankruptcy attorney or even pay an attorney to analyze this issue for you. The amount you would pay would be more than worth it in benefit to you.

Remember that on this forum attorneys try to answer your questions with limited facts available to them. My answer should in no way be considered legal advice. No attorney client relationship has been formed by any answer give here.

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I would have to agree with the first two answers. It really depends. Our office has had higher earners pass the "long form means test." Even if you do that, you still aren't out of the water. Then it has to be determined whether or not you have the ability to pay. My best advice for you would be to find an attorney and get a consultation. Most BK attorneys will give a free consultation. I know our office does. We also have a knack for getting unlikely Chapter 7 candidates into the Chapter 7. That's enough about us. Anything else you would need to know is on our website.

Ben is the associate attorney at the Law Office of Paul Staley. The firm practices exclusively in the areas of Bankruptcy and Family Law. Visit us on the web:

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Depends. I've had clients who were able to obtain discharge in chapter 7 with a 2 person household and $150K annual income, however they had significant debt obligations that are considered allowable deductions that we subracted from the income. Others with much less income were not able to pass the means test. You should consult with an attorney to discuss all details of your potential case. While you have supplied some information, more is needed to answer the question. The devil is in the details.

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