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Why the Means Test Exists
The means test is the gate Congress built to direct higher-income filers away from Chapter 7 liquidation and toward Chapter 13 repayment. According to the U.S. Trustee Program (justice.gov/ust/means-testing), the test asks a single threshold question first: is your income below or above the median family income for your state and household size? Everything else flows from that answer. People's Justice is not a law firm and does not provide legal advice — what follows is a plain-language walkthrough of how the courts and the U.S. Trustee describe the calculation.
Working Through the Test, Step by Step
Step 1 — Calculate your 6-month average gross income
Add up your household's gross income from all sources over the 6 calendar months before the month you file, then divide by six and annualize. The U.S. Trustee captures this on Official Form 122A-1, the 'Statement of Your Current Monthly Income.' Gross means before deductions, and 'current monthly income' is a defined, look-back figure — not simply your most recent paycheck.
Step 2 — Compare to your state median
Compare your annualized income to the median family income the U.S. Trustee publishes for your state and household size. The current median income tables are effective April 1, 2026 (UST). If you are below the median, your case is not presumed to be an abuse of Chapter 7, and — per justice.gov/ust — the chapter is generally available without the additional calculation.
Step 3 — If above median, complete Form 122A-2
Filers above the median move to Official Form 122A-2, the longer means-test calculation. This form subtracts allowed living expenses (many tied to IRS national and local standards) and certain mandatory debt payments to arrive at monthly disposable income. The amount of disposable income left over is what determines whether a presumption of abuse arises. Because the expense standards and median tables both change over time, an attorney works from the most recent figures for your district.
Common Misunderstandings
Being above the median is not an automatic disqualification from Chapter 7 — it simply triggers the Form 122A-2 calculation, which many above-median filers still pass after allowed expenses are subtracted. Conversely, being below the median does not guarantee a discharge; the other requirements (credit counseling, the 8-year bar, honest disclosure to the trustee) still apply. The means test measures income, not whether your individual debts are dischargeable.
People's Justice is not a law firm and does not provide legal advice; we are not a government agency. Running the means test correctly for your household — with the right median table and the right expense standards — is a legal task, and we can connect you with a licensed attorney to do it.
Related Pages
The 341 Meeting and the Trustee
The 341 meeting of creditors is run by your trustee — not a judge — and is typically held 20 to 40 days after filing (uscourts.gov). The trustee places you under oath and asks about your petition and finances. Most consumer meetings are short, and creditors rarely attend. This is general information, not legal advice.
What Bankruptcy Can and Can't Discharge
Chapter 7 discharges most unsecured debts like credit cards and medical bills, but the Bankruptcy Code lists debts that survive: most recent taxes, domestic support, most student loans (absent an undue-hardship adversary proceeding), and fraud debts (uscourts.gov). Liens on secured property can survive discharge. This is general information, not legal advice.
Exemptions and the 730-Day Rule
Exemptions decide what property you keep in Chapter 7. The 730-day domicile rule (§522(b)(3)) determines which state's exemptions apply. Texas and Florida offer an unlimited homestead exemption (with acreage and time caveats); California debtors choose System 1 (CCP §704) or System 2 (CCP §703). This is general information, not legal advice.
Life After Chapter 7: Rebuilding Credit
After discharge — typically about 90 to 100 days after filing for a no-asset case (uscourts.gov) — the automatic stay ends and the fresh start begins. A Chapter 7 discharge is available once every 8 years (uscourts.gov), and a filing affects credit for years. This is general information, not legal advice.
Chapter 7 Bankruptcy Lawsuit
Chapter 7 bankruptcy is a court-supervised process under the U.S. Bankruptcy Code that can discharge most unsecured debts. The U.S. Trustee's means test (Form 122A-1) compares your 6-month average gross income to your state's median family income for your household size; the filing fee is $338 (cacb.uscourts.gov). A trustee — not a judge — administers the case and holds the 341 meeting of creditors 20 to 40 days after filing. Exemptions, governed by the 730-day domicile rule under §522(b)(3), determine which property is protected. Most no-asset cases reach discharge in about 90 to 100 days, and a debtor can receive a Chapter 7 discharge once every 8 years (uscourts.gov). People's Justice is not a law firm and does not provide legal advice; we connect you with licensed attorneys.
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