Means Test in Chapter 7 U.S. Bankruptcy Law

The Means Test is a method implemented under the new bankruptcy law to ensure that people who file for bankruptcy really cannot afford to pay their debts. The intent behind this law is to ensure that those individuals who really are in need, are afforded a fresh start under the law.

Under the means test an individual must determine his total gross monthly. The law includes virtually all income except payments you receive under the Social Security Act, such as SSI, SSDI, and TANF. Included also is the income that your spouse earns if you are living together, even though your spouse is not included with you in your bankruptcy . Under the means test, all of ones gross income is taken into account over the past six months to filing, and an average is taken. The larger your household, the larger that amount can be in order for you to “pass” the means test. The amount permitted for a household of your size is determined by the Census Bureau and the Internal Revenue Service.

The government computes the total gross amount you are permitted to make per month after taking into account the average necessary expenses for a household your size. If therefore, your household makes over this medium amount, you may still be able to file a bankruptcy by reducing your income with unusual necessary monthly expenses. Also expenses for your spouse can be included to reduce this total amount. If you pass the test you will be able to file a Chapter 7 bankruptcy. If you do not pass the test, you may still be able to file a Chapter 13 bankruptcy. If is important that you consult your eligibility to file a chapter 7 bankruptcy with a bankruptcy attorney to determine if you can pass the means test and will qualify to file a bankruptcy.

This blog discusses the means test and generally how one can determine if one’s income is under an amount determined for a household that is your size so that you will be eligible to file Chapter 7 bankruptcy.


Attorney Eli Tamkin is a Cleveland bankruptcy lawyer.  He has been practicing law since 1989 and in Cleveland Ohio since 1994. Since then, he has dealt with a variety of legal issues, including bankruptcy, real estate, divorce, personal injury, and probate. Many times, answering questions on bankruptcy draws on knowledge of other legal areas as well. His experience in these other areas, as well as in bankruptcy enables him to address your particular needs and to offer you advice that is applicable to your situation.



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