Congressman Cohen Speaks from the Floor and Votes on his National Guard and Reservists Debt Relief Extension Act of 2023
Extends exemption from means test when filing for bankruptcy
WASHINGTON – Congressman Steve Cohen (TN-9) today managed the floor debate and then voted for his National Guard and Reservists Debt Relief Extension Act that extends for four more years the exemption from the bankruptcy code’s means test for certain members of the National Guard and reservists. Congressman Cohen led the effort to exempt members of the National Guard and reservists in 2008 and extensions of the exemption in 2015 and 2019. Unless exempted, these servicemembers and veterans must complete the required forms and submit the specified paperwork to satisfy the Bankruptcy Code’s means test.
The measure passed the House on a voice vote.
In his floor remarks, Congressman Cohen said in part:
“Under current law, National Guard members and reservists who serve on active duty are, like other active servicemembers, exempt from the Bankruptcy Code’s means test, which determines whether a debtor’s income is too high to have all of his or her debts erased in bankruptcy. But this critical protection for National Guard members and reservists must be extended before it expires at the end of the year.
“Unless otherwise exempted, these servicemembers and veterans must complete the required forms and submit the specified paperwork to satisfy the Bankruptcy Code’s means test.
“This burdensome requirement would even apply to national guard and reservists who have returned to the United States from active service and thus no longer receive combat pay. Under the means test, such servicemember must calculate his or her income based on the average monthly income that he or she received during the six-month period preceding the filing date of the bankruptcy case, rather than the debtor’s actual income, which may be much less because of the debtor’s non-combat status.
“Without this exemption, some servicemembers and veterans may be prevented from seeking the financial relief that they need and deserve.”
See those remarks here.
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