National Guard Exempt from Means Test Through 2019

The President signed into law the National Guard and Reservists Debt Relief Act of 2015 extending the means test exemption for those who serve in a homeland security capacity as part of the National Guard and reserves.

The means test was put into law in 2005 and requires chapter 7 debtors to meet certain income and expense guidelines in order to qualify for a discharge.

As Baltimore bankruptcy lawyer, I can tell you that disabled veterans who incurred their debts during active duty are and have always been exempt from the means test as a recognition of their service and sacrifice to this country.

In 2008, a new law recognizing the role of the national guard and reserves in post 9/11 America and in the two wars abroad, an exception was provided for National Guard and Reservists.  National Guard and Reservists Debt Relief Act of 2008, Public Law No. 110-438 .

The 2008 law is set to expire this year, but with the 2015 Act will allow eligible National Guard members to file bankruptcy without completing the means test between now and at least 2019.

Given the popularity of the military, it is not a surprise that this law was extended. Furthermore, I believe it will be politically difficult for any Congress or President to let this benefit expire. Therefore, I expect this to be extended once again.