- Armed Forces reservists and National Guard members who have been on active duty or performing homeland defense activity for more than 90 days are eligible for the debt relief exclusions created by the debt forgiveness act. Eligible consumers are excluded from means testing as part of a bankruptcy procedure for the time they are in service and for 540 days thereafter.
- Bankruptcy means testing is a way to determine whether a person's income qualifies him for a Chapter 7 personal bankruptcy. The means test is designed to prevent people with high incomes from taking advantage of Chapter 7 debt protection. The means test deducts specific monthly expenses from an average monthly income for the six months prior to filing for bankruptcy. Active duty reservists and guardsmen receive different pay from their service than they would from their civilian job.
- The National Guard and Reservists Debt Relief Act of 2008 excludes qualifying guardsmen and reservists from filing Form 22A during the period of active duty and for 540 days after completing active duty. Form 22A is the Chapter 7 Statement of Current Monthly Income and Means-Test Calculation form that must be completed by each person filing for Chapter 7 bankruptcy protection. Even though the debt forgiveness act delays the necessity of submitting the form, it must still be completed after the 540-day period expires.
- While the National Guard and Reservists Debt Relief Act of 2008 relieves eligible debtors from a means test qualification, the exclusion may only be temporary. Reservists and guardsmen must submit the completed Form 22A within 14 days of the exclusion expiration. Exceptions occur if the motion for filing a means test presumption has already expired in the debtor's case for Chapter 7 bankruptcy protection.