An income over $60,000 per year is in excess of the median income in New York, for a family size of one, thus, under New York Bankruptcy Law, the means test will apply. This is to ensure the Chapter 7 filing is not abusive. However, based on IRS standards for housing and utilities in Manhattan ($2936 per month for housing and $611 for utilities), there should be no difficultly in passing the means test, as it also includes expenses allocated for transportation ($302), personal living expenses ($691 per month food, clothing etc) and a variety of “other necessary expenses” (such as internet, medical/dental and taxes). It should be noted that even where the debtor actually spends less than the IRS standards, the debtor has been entitled to use the IRS standards, excepting the other necessary expenses category. New York Bankruptcy Law states actual expenses must be used.

(Courtesy of Association of the Bar of the City of New York)