Current Monthly Expenses means Test

There are five categories of allowed expenses (or deductions from current monthly income) set forth at Section 707(b)(2)(A)(ii) – (iv):
(a) expenses according to certain charts;
(b) amounts allowed in addition to the charts;
(c) payments to secured creditors;
(d) payments of priority claims;
(e) expenses for “special circumstances.”

1. The Charts
The first level of allowed expenses is the amount specified in three different charts under Internal Revenue Service expense standards. They are:
(a) amounts allowed pursuant to the National Standards;
(b) amounts allowed pursuant to the Local Standards; and
(c) the debtor’s actual monthly expense in the categories specified in the Other Necessary Expenses. 11 U.S.C. §707(b)(2)(A)(ii).

These charts can be found at:
http://www. national’_expense_ standards, htm http: //www.usdoj .gov/ust/bapcpa/bci_data/ IRS_Trans _ Exp JStds_WE.htm

2. Amounts Allowed in Addition to the Charts
In addition to the amounts allowed by the charts, the debtor may deduct the following from current monthly income pursuant to Section 707(b)(2)(A)(ii):
(a) insurance – “reasonably necessary” medical insurance, disability insurance, and health savings account expenses;
(b) safety expenses – “reasonably necessary” expenses “incurred to maintain the safety of the debtor from family violence (as identified under section 309 of the Family Violence Prevention and Services Act, or other applicable Federal law);
(c) additional food and clothing – an amount up to 5% over the National Standards for food and clothing if “it is demonstrated that it is reasonable and necessary”;
(d) care of disabled, ill or elderly – “the continuation of actual expenses” to care for “an elderly, chronically ill, or disabled” household member or the debtor’s immediate family if that person is unable to pay for such expenses;
(e) Chapter 13 expenses – the projected monthly fee charged by the trustee for administering the plan, up to an amount of 10% of the projected plan payments;
(f) education – up to a total of $1,500 per year per child “less than 18 years of age” for public or private education. The debtor must provide “a detailed explanation of why such expenses are reasonable and necessary and why such expenses are not already accounted for” in the IRS charts.
(g) excess housing expenses – actual expenses for “home energy costs” in excess of the Local Standards (IRS chart). The debtor must “provide documentation of such actual expenses and demonstrates that such actual expenses are reasonable and necessary.”

3. Payments to Secured Creditors

In addition to the amounts allowed by the charts [11 U.S.C. §707(b)(2)(A) ((ii)(I)], and the amounts allowed in addition to the charts [11 U.S.C. §707(b)(2)(A)(ii)(I) – (V)], the debtor may deduct the following from current monthly income pursuant to Section 707(b)(2)(A)(iii):

The total amount owed to secured creditors for the next 60 months divided by 60, and any “additional payments to secured creditors necessary for the debtor, in filing a plan under chapter 13 …, to maintain possession of the debtor’s primary


residence, motor vehicle, or other property necessary for the support of the debtor and the debtor’s dependents, that serves as collateral for secured debts divided by 60.”


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