The Chapter 7 Means Test: Do You Qualify?

The Chapter 7 means test is a two-step comparison, not a single number. First, your household's average income over the past six months is compared to the median income for a household your size in your state. If you're at or below that median, you generally pass and can move forward with Chapter 7. If you're above it, a second calculation subtracts allowed living expenses and certain debt payments from your income to see whether you'd have enough left over each month to pay something toward your debts. If that leftover amount is too high, the law presumes Chapter 7 isn't the right fit for you — and points you toward Chapter 13 instead.

None of the dollar thresholds involved in this test are fixed numbers you can memorize. The median-income figures are pulled from Census Bureau data and updated by the Department of Justice's U.S. Trustee Program roughly twice a year; the expense allowances (IRS "National Standards" and "Local Standards") are updated on a similar schedule. Because those figures change while this page doesn't, this article deliberately does not quote any of them. Before you calculate anything, pull the current numbers from the source.

What the means test is actually deciding

Congress added the means test to the Bankruptcy Code (11 U.S.C. § 707(b)) so that people with enough spare income to repay a meaningful chunk of their debts would generally use a repayment plan (Chapter 13) rather than a straight liquidation and discharge (Chapter 7). It isn't a judgment about whether you "deserve" bankruptcy relief — it's a formula that estimates whether you can afford to pay creditors something over time.

The test is filled out on official bankruptcy forms: Form 122A-1 (Chapter 7 Statement of Your Current Monthly Income), and, if needed, Form 122A-2 (Chapter 7 Means Test Calculation). A related form, 122A-1Supp, lets certain filers — including some disabled veterans and people whose debts are not primarily consumer debts — claim an exemption from the test entirely. You can download the current versions of all three directly from the U.S. Courts website.

Step 1: Comparing your income to your state's median

The starting point is "current monthly income," or CMI, a defined term under 11 U.S.C. § 101(10A). It is generally the average of your gross household income over the six full calendar months before you file — not what you happen to be earning the week you file, and not your take-home pay. A few sources are specifically excluded from CMI, most notably Social Security benefits.

That six-month average is annualized and compared against the U.S. Trustee Program's published median family income for your state and household size. Household size matters and can be a genuinely tricky question if you support a child part-time, have a boomerang adult child at home, or share expenses with a non-filing spouse — get help if your household composition isn't straightforward.

• If your income is at or below the median for your state and household size, you are not required to complete the detailed expense calculation, and your case is generally not presumed to be an abuse of Chapter 7. Most filers pass at this step.
• If your income is above the median, you move to Step 2.

Step 2: Subtracting allowed expenses to find disposable income

If you're above the median, Form 122A-2 walks you through subtracting a set of allowed expenses from your CMI — not your actual, personal budget, but standardized amounts. Some categories use the IRS's National Standards (food, clothing, personal care, and similar) regardless of what you actually spend; others use Local Standards that vary by where you live (housing, utilities, transportation); and some let you deduct your actual secured debt payments (like a mortgage or car loan), certain priority debts (like recent tax debt or domestic support obligations), and a few other specific items.

What's left after all of that is your monthly "disposable income" under the formula. That number is then measured against thresholds set out in the statute and the U.S. Trustee's published data. Come out below the relevant threshold and you pass the means test even though your income was above median. Come out above it, and the law presumes your case is an abuse of Chapter 7 — though that presumption can sometimes be rebutted by documenting special circumstances, such as a serious illness or a call to active military duty, that the standard form doesn't capture.

The safe-harbor shortcut

Because Step 1 alone resolves most cases, many people never have to touch Step 2. If your household income is comfortably below your state's median for your family size, don't assume you're disqualified just because you have significant debt — income relative to the median, not the size of your debt, is what triggers the deeper calculation.

If you don't pass: Chapter 13, not "no options"

Failing the means test doesn't mean you're locked out of bankruptcy relief. It generally means Chapter 7 isn't presumed appropriate for you, and the more likely path is a Chapter 13 repayment plan, where you keep more property and repay creditors, in whole or in part, over a multi-year court-approved plan based on your actual income and expenses. See our guide to Chapter 13 bankruptcy for how that process works, including its own debt-limit eligibility rules (which, like the Chapter 7 figures, are adjusted periodically — check the current limits at the source rather than relying on a remembered number).

A bankruptcy attorney can also sometimes identify that your debts are not "primarily consumer debts" (for example, if they're mostly business-related), which can exempt you from the means test altogether, or can help document special circumstances that overcome a presumption of abuse.

Where to check the current numbers

Because these figures move, always confirm them directly before you rely on them:

• U.S. Courts (uscourts.gov) — the official Chapter 7 means test forms (122A-1, 122A-1Supp, 122A-2) and general bankruptcy basics pages.
• DOJ U.S. Trustee Program (justice.gov/ust) — the current median-family-income tables by state and household size, and the IRS-based National and Local Standards used in Step 2, updated on their published schedule.
• Your state's exemption statutes — a separate but related question from the means test: what property you get to keep. Exemption dollar amounts are periodically adjusted for inflation and vary significantly by state, so look up your own state's current statute (or ask an attorney) rather than assuming a figure.

What to do: practical steps

1. Gather six months of income records — pay stubs, benefit statements, self-employment records — for every household member whose income counts toward CMI.
2. Pull the current median-income table for your state and household size from justice.gov/ust before you estimate anything.
3. Complete a credit counseling course from a U.S. Trustee–approved agency. This is a hard deadline: with limited exceptions, you generally must complete an approved counseling course in the 180 days before you file, or your case can be dismissed. The U.S. Trustee Program's website maintains the approved-agency list by state.
4. Talk to a bankruptcy attorney before you file, especially if your income is near or above the median, if your household composition is complicated, or if you have significant assets you're worried about protecting. Many offer free or low-cost initial consultations.
5. If cost is the barrier, look into legal aid organizations, law-school bankruptcy clinics, and your local bankruptcy court's self-help resources — several are listed or linked from uscourts.gov.
6. If you fail Step 1, don't assume you're out of options — ask an attorney about Step 2, special-circumstances rebuttals, or whether Chapter 13 fits your situation better.

Beware of scams and unauthorized advice

Be cautious of for-profit debt-settlement or "debt relief" companies that promise to fix your debt outside of bankruptcy for large upfront fees — the Federal Trade Commission has taken action against many such operations, and they are not a substitute for the legal protections bankruptcy provides. Also be wary of non-attorney "bankruptcy petition preparers" who offer legal advice about which chapter to file or how to fill out the means test; by law they may only type your paperwork, not advise you, and many overstep that line illegally. When in doubt, use a licensed bankruptcy attorney or a U.S. Trustee–approved credit counseling agency.

Frequently asked questions

Does failing the means test mean I can never file Chapter 7?

No. It means your specific case, as filed, is presumed not appropriate for Chapter 7. An attorney may be able to show special circumstances, recalculate your household size, or demonstrate your debts aren't primarily consumer debts. Otherwise, Chapter 13 is usually the next path.

What counts as "current monthly income" if my hours vary or I just lost my job?

CMI is generally a six-month look-back average, so a recent job loss may not immediately lower it — your income from months before the loss still counts in the average. This timing quirk trips people up; an attorney can advise on whether waiting to file changes your result.

Does unemployment or Social Security count toward the means test?

Some benefits are treated differently than wages. Social Security income, in particular, is excluded from CMI by statute. Other benefits may or may not count — confirm with the current form instructions or an attorney rather than guessing.

Is the means test the same as the property exemptions that protect my house or car?

No — they're separate questions. The means test decides whether you qualify for Chapter 7 in the first place. Exemptions (set by federal or state law) decide what property you get to keep once you're in bankruptcy. Check your own state's exemption statute for current amounts.

Do I have to take a class before I file?

Yes — with narrow exceptions, federal law requires a credit counseling course from a U.S. Trustee–approved agency within 180 days before filing, and a separate debtor-education course before your debts can be discharged. Missing the pre-filing course is a common, avoidable reason cases get dismissed.

This article is general legal information, not legal advice, and reading it does not create an attorney-client relationship. Consider consulting a qualified bankruptcy attorney, or a U.S. Trustee–approved credit counseling agency, before relying on it — and be wary of for-profit debt-settlement companies and non-attorney petition preparers offering legal advice.