Johnson County residents understand that financial challenges can arise in anyone’s life. A few bumps in the road are to be expected. However, some Kansans may find that a few bumps at the wrong time can lead to overwhelming debt. When this happens, bankruptcy may be able to provide individuals with the fresh financial start they need.
Take the recent example of the musician Young Buck. The rap star was sentenced to prison last year and is currently serving time on a weapons possession charge, but he has had some good news: upon his release, he will be free of the overwhelming debt with which he was struggling before going to prison. That includes a personal debt owed to fellow rapper 50 Cent in the amount of $300,000. Record label G-Unit will also not recoup any of the money they claim Young Buck owes them.
Chapter 7 Bankruptcy is an important legal option afforded to any individuals who qualify – not just to high-powered music and entertainment icons. But filing for Chapter 7 does typically require passing what is called a “means test.” The means test is a standard Congress established in 2005.
The first step in the means test is that one’s income for the six months preceding the bankruptcy filing date will be compared to the median family income here in Kansas. If it is equal to or less than that median, then Chapter 7 will be an option. If it is above that median, a second step involves asking whether the filer could afford to pay off some of the unsecured debt under Chapter 13 after deducting allowable expenses. If the answer is no, then the filer may still be considered to pass the means test for Chapter 7.
Clearly there are some important factors to consider before applying for Chapter 7 Bankruptcy, if indeed that is the right decision. A legal professional can help Johnson County residents analyze their situation and formulate a strategy for dealing with overwhelming debt.
Source: Hip Hop DX, “Young Buck To Emerge From Prison Debt-Free,” Danielle Harling, Sept. 19, 2013