What is the bankruptcy means test?
The means test is a two-part calculation that determines whether you qualify for Chapter 7 bankruptcy. First, it compares your household income to your state's median income. If you are below the median, you pass automatically. If above, a second calculation examines your disposable income after allowed expenses.
What income is included in the means test?
The means test uses your average monthly income for the 6 months before filing, including wages, salary, tips, bonuses, overtime, business income, rental income, pension, disability, unemployment, and contributions from others. Social Security income is excluded.
What is the income limit for Chapter 7 in my state?
The income limit varies by state and household size, and is updated every 6 months by the Census Bureau. For example, a family of 4 in Missouri has a median income of approximately $88,724 (2024). Our calculator at bankruptcymeanstest.org/calculator.html uses the latest figures.
What expenses can I deduct on the means test?
Allowed expenses include IRS National Standards for food, clothing, and personal care; IRS Local Standards for housing and transportation; actual amounts for taxes, insurance, childcare, education for disabled children, healthcare, and secured debt payments. You cannot deduct actual spending that exceeds IRS standards in most categories.
Does Social Security income count on the means test?
No. Social Security benefits are explicitly excluded from the means test calculation under 11 U.S.C. Section 101(10A). This includes retirement, disability (SSDI), and survivor benefits. SSI (Supplemental Security Income) is also excluded.
What if my spouse works but is not filing with me?
Your spouse's income is included in the means test calculation even if they are not filing bankruptcy. However, you can deduct a 'marital adjustment' for your spouse's separate expenses, which may offset their income.
Can I still qualify for Chapter 7 if I'm above the median income?
Yes. If your income exceeds the median, the second part of the means test examines your disposable income after allowed expenses. If your disposable income is below certain thresholds, you still qualify. High-expense filers (mortgage, car payments, medical costs) often pass despite above-median income.
How is the 6-month income period calculated?
The means test looks at the 6 full calendar months before the month you file. For example, if you file in July, the test examines income from January through June. Strategic timing of your filing can affect which months are included.
What happens if I fail the means test?
Failing the means test means a presumption of abuse arises and you may not qualify for Chapter 7. Your options include filing Chapter 13 instead, waiting to file until your income drops, or rebutting the presumption by showing special circumstances (such as a medical condition or military service).
Can I time my filing to pass the means test?
Yes. Because the means test uses a 6-month lookback period, strategic timing can help. If you had unusually high income in recent months (bonus, overtime, temporary job), waiting until those months fall outside the 6-month window can lower your average.
Are military service members exempt from the means test?
Certain veterans and active duty service members are exempt. If you served on active duty or in a homeland defense activity for at least 540 days in the 4 years before filing, you are exempt from the means test. National Guard members who performed homeland defense activity may also qualify.
Do I include my child's income on the means test?
Generally no. Only income that contributes to your household expenses is included. A child's part-time job income is typically not counted unless they contribute to household bills.
What is the means test form number?
The means test is calculated on Official Bankruptcy Form 122A-1 (Chapter 7 Statement of Your Current Monthly Income) and, if needed, Form 122A-2 (Chapter 7 Means Test Calculation). These forms are available free at uscourts.gov.
Can the U.S. Trustee challenge my means test results?
Yes. The U.S. Trustee reviews means test calculations and can file a motion to dismiss your case for abuse if they believe the calculations are inaccurate or if your financial circumstances suggest you can afford to pay creditors through Chapter 13.
What is the difference between current monthly income and actual income?
Current monthly income (CMI) is a legal term that means your average income over the 6 months before filing. It may be very different from your actual income at the time of filing. If you lost a job recently, your CMI may be higher than your actual current income.