Deducting Certain Expenses for Mean's Test Purposes (Part II)
In the most recent post, we discussed IRS guidelines for mean's test purposes. This post deals with secured debt that debtors wish to surrender but want to claim as an expense under the mean's test. Can debtors do this?
The answer is probably yes. The mean's test looks to actual expenses incurred before the debtor files the petition. Therefore, if a debtor is wanting to surrender either real or personal property, if the IRS provides for that expense in its guidelines, then the debtor may deduct that expense even though he or she is surrendering the property. This should really help the debtor lower overall his or her disposable income.
The lower the debtor's disposable income, the better chance he or she has at passing the mean's test.
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