It depends. First and foremost, you need to pass the means test to see whether you qualify to file a Chapter 7. The means test is based on a combination of actual expenses and set expenses based on certain IRS standards for your State and particular county of residence. Sometimes you can pass the means test based on your income alone without the need of looking at expenses. However, if you cannot automatically pass the means test due to your income (or more than 50% of your personal expenses are business expenses), and if you still cannot pass the test after all of the allowable expenses are taken into consideration, you might still be able to pass the test depending on the reason behind certain non-allowed expenses and other mathematical factors. If not, the trustee can more to dismiss the case as being abusive.
Simply stated, the means test is not cut and dry for all debtors. You should really meet with a bankruptcy attorney to see whether you not you can even qualify for a chapter 7 instead of attempting to handle the case on your own.
If you are interested in a more detailed legal analysis of your situation and reside in Illinois, contact 360 Legal toll-free at 855-360-4608 or at www.threesixtylegal.com. I am only licensed in the state of Illinois. This is only my general observation about the law and my experiences as a practicing attorney. This is not legal advice and should not be construed as legal advice. This does not create an attorney client relationship. If you wish to obtain legal advice or create an attorney-client relationship, then you should directly contact a lawyer licensed in your state who you believe possesses the knowledge and experience to assist you with your case.
If it is that expense that is causing you to go from 'failing' the means test and 'passing' the means test, then the US Trustee's office can file a motion to dismiss your case.
If you're asking will a Chapter 7 panel trustee (one of the direct trustees appointed to your case) will file for a dismissal if you are below median just because you have a too-high expense? Probably not.
William Devine, II
I am an attorney, just not your attorney (yet). Any answers here are to be deemed informational unless and until you retain me as your attorney for actual legal services and legal advice. I offer free in-person consultations so feel free to contact me offline by email or phone. If you like my answer, please hit the thumbs up button.
As is mentioned before you can only file a Chapter 7 if you can show your income is below the IRS standards in your place of residence. You also have to list your necessary and reasonable expenses on one of the schedules (Schedule J). If you can show that the amount you spend, documented, is reasonable and necessary then the trustee will usually not have a recourse.
However, if the expense is not reasonable and necessary and without the expense you are shown to have disposable income, the trustee may inquire if you are should have filed under Chapter 13 protection. I would need more information regarding your current monthly income and expenses.
If you do not have an attorney, please contact my office as I do free consultations.
The trustee cannot dismiss your expenses. Ever.
The trustee, or the office of the United States Trustee, can file motions to dismiss, and you can reply. If you lose, you can convert to chapter 13--and the order from the dispute likely tells you what your payment will be.
If your expenses are high because you eat lobster at home three nights a week and at fancy restaurants the other days, and for the high maintenance on your Maserati, you likely won't qualify for Chapter 7.
If it's treatment for your child's cancer and supporting all four of your divorced grandparents, you likely will.
Most people are somewhere in between.
You're not going to find the answer for your own facts on the internet. You need to hire a bankruptcy attorney to help you with the means test before you file.
And sometimes, if you're a close call, it's worth trying Chapter 7, understanding that you get converted to 13 if you lose.