Means Test Exception – Disabled Veteran


Disabled Veteran Means Test Exception

Another means test exception is carved out for a disabled veteran.  With all the sacrifices our military men and woman make, this is a powerful one that can really help their families and future.

Brief Summary of Means Test

Just in case you didn’t read our prior post on the business debt exception to the means test, the means test is a way for the Court to determine if someone is eligible to file a Chapter 7.  Chapter 7 is the bankruptcy where you simple get rid of all your debt.  In order to qualify, the means test looks at what your gross income prior to filing is, averages, than annualizes it and compares it to what your family size median income is.  If you make less than the median, you qualify.  If you make more than the median, then you’ll have to do the long form version of the test.

If you’d like more information on bankruptcy in general, click here.

How to Qualify for the Exception? (See 11 USC 707(b)(2)(D))

  1. Disabled Veteran

(a) You are receiving veteran disability compensation by being at least 30% disabled; or

(b) you have been discharged from service, or released from active duty, because of “a disability incurred or aggravated in line of duty” (28 USC 3741) ,


2. Your “indebtedness occurred primarily during a period” in which you were either:

(a) On “active duty” meaning “full time duty in the active military service of the United States” (10 USC 101(d)(2)); or

(b) “performing a homeland defense activity”. (32 USC 901(1))



Obviously this is a powerful exception with specific requirements to them.  Should you believe you may qualify for this exception, please do not hesitate in contacting Seneca Law for a free 30 minute consult.  Get all the information you need before making any decisions.

Leave a Reply

Your email address will not be published. Required fields are marked *