MEMORANDUM OF DECISION

JIM D. PAPPAS, Bankruptcy Judge.

Introduction

Chapter 71 debtor Aaron de Bruyn Kops ("Debtor") based his means test calculations on a household of three,2 and estimated his expenses for childcare costs. Creditor Samantha de Bruyn Kops ("Creditor"), Debtor's former spouse, filed a Motion to Dismiss Debtor's case, asserting a presumption of abuse exists under § 707(b). She argues that, for means test purposes, Debtor has a household of 1.34 due to the couple's split-custody of their children. Creditor also asserts Debtor's actual childcare expense is much lower than his estimates, and that his calculations should be adjusted accordingly. A hearing on Creditor's motion was held January 10, 2012, and, after additional briefing, the Court took the issues under advisement. After considering the evidence, testimony, the parties' submissions, and applicable law, this Memorandum sets forth the Court's findings of fact and conclusions of law. Rule 7052, 9014.

Facts3

Debtor and Creditor married on February 14, 2004; in early May 2010, Creditor filed for divorce. The couple has two children.

On July 9, 2010, the state court entered a temporary order in Creditor's divorce action ("July 9 Order"). Exh. 202. That order was to be effective until the court finalized the couple's divorce, and provided that Debtor and Creditor would have joint legal custody of their children, with physical custody awarded to Creditor. Id. The order granted Debtor "supervised visitation" with the children during the pendency of the divorce action, but provided no guidance on when, or for how long, each visit should occur. Id.

The July 9 Order also divided and assigned responsibility for payment of some the couple's financial obligations. Debtor was ordered to pay Creditor $1,188 per month in child support. Id. The costs of "day care" for the couple's children was ordered divided between the two, with Debtor responsible for 61% of the costs, and Creditor responsible for 39%. Id. The state court deferred any decision as to liability for "the preschool expense for the Calvary Christian School that their oldest minor child will attend this fall [of 2010]." Id.

The state court entered a final divorce decree on September 15, 2011, nunc pro tunc as of February 24, 2011 ("Final Order"). Exh. 204. The Final Order granted Creditor "primary residential custody" of the couple's children, specifying that Debtor have physical custody of the children "every other weekend," alternating holidays, and for two weeks of consecutive time during the summer. Id.

The Final Order continued Debtor's obligation to provide $1,188 per month in child support. Id. The order also continued the percentage distribution assigned the parties for "work-related day care." Id. In addition, the Final Order required Debtor to pay 61% of "the Calvary Chapel Preschool debt," and of "the Monarch Day Care bill." Id.

For the 2010 tax year, the Final Order allowed each parent to claim a child for tax exemption purposes; for 2011 and thereafter, Debtor would be allowed to claim both children as dependents. Id.

Debtor filed for chapter 7 bankruptcy relief on July 13, 2011. Dkt. No. 1. No evidence was provided to the Court regarding who was physically present in Debtor's home on that date.4

The parties' offered evidence documenting day care expenses is not much better.5 Based on that record, Debtor's and Creditor's total childcare expense for the six month period prior to July 13, 2011,6 was roughly $2,975, or about $496 per month. Per the state court orders, Debtor's share of that total was $1,814.75, or about $302.46 per month. Payments of $1,500 were made to The Monarch during the six months prior to July 13, 2011, and Debtor testified he made $900 of those payments.7 Averaged out, that $900 equates to payments of $150 per month. Yet, Debtor's most recent amended Form B22A8 indicates Debtor based his means test calculations on a monthly childcare expense of $500 per month.

Debtor's revised Form B22A provides he has a monthly disposable income under § 707(b)(2) of negative $235.56.9

Creditor argues Debtor's means test calculation should be further adjusted for two reasons. First, Creditor asserts that, because Debtor only has custody of their children part time, Debtor's proper household size for the purposes of the means test is 1.34 persons, not 3 persons. Second, Creditor asserts Debtor's childcare expense should reflect the amount he actually paid, not $500 per month.10 Debtor disagrees with Creditor's position on both counts.

Discussion

I. Debtor has a household of three for means test purposes.

The correct number of persons to use in completing means test calculations has been a source of confusion since the passage of the 2005 amendments to the Bankruptcy Code ("BAPCPA"). Courts have developed three different standards for application in determining what the correct number should be: the "heads on beds" or Census Bureau approach; the "IRS dependency" approach; and the "economic unit" approach.

1. The Heads on Beds or Census Bureau Approach.

The first approach adopted by some bankruptcy courts, the so-called "heads on beds" approach, includes anyone living in a debtor's home at the time he or she files for bankruptcy as part of a household for means test calculations purposes. See, e.g., In re Ellringer, 370 B.R. 905, 910-11 (Bankr. D. Minn. 2007).

Sections 707(b)(6) and (7) tie a bankruptcy court's ability to dismiss or convert a chapter 7 case to a comparison of the debtor's "current monthly income" to national "median family income" figures for a "household" of the same size as the debtor's. While the term "household" is not defined in the Code, "median family income" is, and means "the median family income both calculated and reported by the Bureau of the Census in the then most recent year." § 101(39A)(A).

Because of this provision's reference to the Census Bureau (the "Bureau"), bankruptcy courts have consulted that agency for a definition of "household." See, e.g., In re Epperson, 409 B.R. 503, 506-07 (Bankr. D. Ariz. 2009); In re Ellringer, 370 B.R. at 910-11. The Bureau defines "household" to "consist[] of all the people who occupy a housing unit . . . includ[ing] the related family members and all the unrelated people, if any, such as lodgers, foster children, wards, or employees who share the housing unit." U.S. Census Bureau, Current Population Survey (CPS) — Definitions and Explanations, www.census.gov/ population/ www/ cps/ cpsdef.html. Grasping that definition, some bankruptcy courts have assumed the Bureau's definition of household must apply to all means test components, rationalizing that doing so "ensures that a household in the means test will have the same number of members as the calculation of median family income." In re Ellringer, 370 B.R. at 910-11.

Respectfully, the error in this reasoning is plain. Section 101(39A)(A) refers to the Bureau's calculated and reported figures for "median family income," not "median household income." The Bureau produces figures for both, and the methodology used in calculating either figure primarily hinges on the differences in the Bureau's definitions of "family" and "household." See U.S. Census Bureau, 2010 Subject Definitions at 80, www.census.gov/ acs/ www/ Downloads/ data_documentation/ SubjectDefinitions/ 2010_ACSSubjectDefinitions.pdf.

The Bureau's statistics on household income include not only the income of a dwelling unit's owner or renter, but also the income for "all other individuals 15 years old and over in the household, whether they are related to the [owner or renter] or not." Id. Such is the type of "household" integrated into the heads on beds approach. See In re Ellringer, 370 B.R. at 911 (relying on the Bureau's definition of household as "all of the people, related and unrelated, who occupy a housing unit").

At the same time, "[i]n compiling statistics on family income, the incomes of all members 15 years old and over related to the [owner or renter] are summed and treated as a single amount." U.S. Census Bureau, 2010 Subject Definitions at 80. Only those members "residing" with the owner or renter at the time the Bureau conducted its interview, have their income included in the family income statistics.11 Id. Thus, while the Bureau's "household"—based statistics account for all persons living in a home, regardless of relationship, the "median family income" figure referred to by Congress in § 707(b)(6) and (7) incorporates only the income of related individuals residing in a home. See id.

Applying the Bureau's "household" definition to all aspects of the means test would not "ensure[] that a household in the means test will have the same number of members as the calculation of median family income." Contra In re Ellringer, 370 B.R. at 910-11. Rather, any time unrelated individuals live in a debtor's home, the Bureau's definition of "household" will produce a number greater than the "family" upon which the median family income figure is calculated,12 creating an inconsistency between that figure and the figure upon which the remaining means test calculations would be based. Because the Bureau's "household" definition, upon which the heads on beds approach is based, does not correlate to the Bureau's definition of "median family income," it should not, absent clear direction from Congress, be applied throughout the means test.

2. The IRS Dependency Approach.

The second approach adopted by bankruptcy courts tasked to determine who is appropriately included in a debtor's means test calculations looks not to the Census Bureau, but to the IRS. See In re Robinson, 449 B.R. 473, 479 (Bankr. E.D. Va. 2011). Under § 707(b)(2), a debtor is limited to claiming means test expenses for himself, his "dependents," and his spouse in a joint case, if she is not otherwise a dependent. § 707(b)(2)(A)(ii)(I). Because the expenses which a debtor can claim under the means test are primarily those included in various standards issued by the IRS, and because the standards may only be deducted for a debtor or his "dependents," bankruptcy courts following the IRS dependency approach have limited the definition of "household" for means test purposes to a person the debtor may claim as a dependent on his tax return. In re Morrison, 443 B.R. 378, 385 (Bankr. M.D.N.C. 2011).

However, while the § 707(b)(2) expenses are limited to amounts a debtor can claim for himself and his "dependents," there is no indication Congress intended the term "household," or even the term "dependents," to be limited to persons that may be claimed as dependents for tax purposes. The first step in determining the meaning of a federal statute's language is to look at the text's plain meaning. Father M. v. Various Tort Claimants (In re Roman Catholic Archbishop of Portland), 661 F.3d 417, 432-33 (9th Cir. 2011). Words in the text are to be given their ordinary meanings, unless otherwise defined. See id. Dictionary definitions may be used to determine specific language's plain, ordinary meaning. See id. Section 707(b)(2) does not assign a specialized definition or meaning to the word "dependent." Turning to the dictionary, "dependent" is defined as "[o]ne who relies on another for support." BLACK'S LAW DICTIONARY 503 (9th ed. 2009). Because that definition is much broader than a dependent for tax purposes only, the Court concludes the IRS dependency approach is not appropriate for use throughout the means test.

3. The Economic Unit Approach.

The third judicially developed approach is known as the "economic unit approach." Initially, in construing § 707(b)(2)(A)(ii)(I), bankruptcy courts dissatisfied with the other two approaches considered household members to be anyone who was a debtor's "dependent" in a general sense of the word, i.e., someone financially supported by the debtor. See In re Herbert, 405 B.R. 165, 169-70 (Bankr. W.D.N.C. 2008); In re Jewell, 365 B.R. 796, 800-02 (Bankr. S.D. Ohio 2007). More recently, though, the courts have fashioned a test that deems a person a member of a debtor's household if that person operates as a "single economic unit with the debtor." See, e.g., In re Morrisson, 443 B.R. at 388. In defining "economic unit," some courts have gone beyond the Code's language, and developed a list of factors to be considered in determining whether the debtor and another are such a unit.13 Id. Respectfully, those courts go too far.

The Code does not look to whether there is an integrated financial relationship between a debtor and another person for whom he is claiming expense deductions. See § 707(b)(2)(A)(ii)(I). In many cases, following that approach would turn the language of the Code on its head. For example, under In re Morrisson, an individual whose only financial connection to a debtor is one by which she supports the debtor is likely considered an "economic unit" with the debtor, and is a "household" member for means test purposes. See 443 B.R. at 386. The Code, however, does not allow a debtor to claim means test expenses for an individual of whom he is a dependent; he may only claim such expenses for persons that are dependent on him. See § 707(b)(2)(A)(ii)(I).

As noted, the dictionary defines "dependent" as one who relies on another for support. That definition is consistent with the definition of "household" from early "economic unit" approach cases. Namely, a household for means test purposes involves a debtor, those financially supported by the debtor, and the debtor's spouse in a joint case if she does not otherwise rely on the debtor for support. § 707(b)(2)(A)(ii)(I); In re Herbert, 405 B.R. at 169-70; In re Jewell, 365 B.R. at 800-02.

Inasmuch as the economic unit approach is limited to a unit consisting of a debtor and his dependents, such an approach is appropriate for use throughout the means test. In other words, the correct approach is one that determines household members based on a person's financial dependence upon, and residence with, a debtor.14

4. Application of the Test to the Facts.

Having settled which general approach this Court will use in determining "household" members for means test purposes,15 the question remains of how to treat otherwise dependent children who only reside with a debtor for a portion of the time. This is not an easy call.

Creditor cites the Court to In re Robinson, 449 B.R. 473 (Bankr. E.D. Va. 2011), a decision where, as here, a debtor-father had part-time physical custody of his children. The bankruptcy court decided the best way to accommodate such a situation was to treat each child as "a fractional member of the household." 449 B.R. at 482. In other words, the court mathematically determined that, based on the number of days per week any given child lived with the debtor, the debtor's four children were only the equivalent of "two full members of the economic unit."16 Id. In that manner, the court concluded it was accurately calculating the means test based on the debtor's "functional economic unit." Id.

There is no textual or other indication in the Code, however, to show that Congress intended debtors to calculate "fractional dependents," or "fractional household members," in completing means test calculations. Admittedly, a debtor who has children living with him for only a portion of the month will incur a lesser amount of actual monthly expenses than a debtor whose children live with him full time.17 For many of the means test expense categories, however, debtors are required to claim expenses based on standardized amounts, rather than their actual expenses. See § 707(b)(2)(A)(ii)(I). When Congress adopted a means test that relies on uniform standards, it endorsed the notion that those standards, depending upon the facts, would be either over- or under-inclusive. Ransom v. FIA Card Servs., N.A., 131 S.Ct. 716, 729 (2011). In designing the Code, "Congress chose to tolerate the occasional peculiarity that a brighter-line test produces."18 Id.

Because Debtor's two children may reside with him for a portion of each month, and because those children are his financial dependents, the Court concludes they should be counted as part of Debtor's household for means test purposes.19 Debtor's amended means test Form B22A therefore appropriately calculates expenses based on a household of three.

II. Debtor's Form B22A expenses for childcare must be reduced to his actual expenses.

Section 707(b)(2)(A)(ii)(I) provides:

Among the "Other Necessary Expense[s]" is childcare. As instructed on Form B22A, debtors are to "[e]nter the total average monthly amount that [they] actually expend on childcare—such as baby-sitting, day care, nursery, and preschool." Form B22A, line 30. Based on the evidence presented at the hearing, the Court determines Debtor's average monthly actual childcare expense is $150 per month.

The difference between Debtor's claimed childcare expense of $500 per month and his actual expense of $150 per month results in a change in his monthly disposable income under § 707(b)(2) from negative $235.56 to positive $114.44. Thus, Debtor has a 60-month disposable income under § 707(b)(2) of $6,866.40. Even with that adjustment, however, Debtor's 60-month disposable income does not meet the threshold to establish a presumption of abuse under § 707(b)(2).20

Conclusion

Debtor's household size for means test purposes is three persons, and he may claim means test expenses for himself and his two financially dependent children, who reside with him part-time in any given month. At the same time, Debtor is limited to claiming childcare expenses to the average of his actual paid expenses, which the Court finds to be $150 per month. Even with that adjustment, however, a presumption of abuse does not arise in this case. Creditor's motion to dismiss pursuant to § 707(b) will therefore be denied in a separate order.

A separate order will be entered.