About the means test
The means test has two functions. In Chapter 7, it determines whether the filing is presumed to be an abuse of the bankruptcy system under section 707(b)(2), in which case the case must be dismissed (or, with the debtor's consent, converted to Chapter 13) absent rebuttal by a showing of special circumstances. In Chapter 13, it determines the applicable commitment period (three years for below-median debtors, five years for above-median debtors) and constrains the calculation of projected disposable income that must be paid to unsecured creditors under section 1325(b).
The mechanics are deceptively simple. Form 122A-1 calculates current monthly income (CMI) by averaging the debtor's gross income from all sources during the six full calendar months preceding the petition date and multiplying by twelve to annualize. If annualized CMI is at or below the applicable state-and-household-size median income (published quarterly by the United States Trustee Program), the means test is over and no presumption arises. If CMI is above the median, the debtor proceeds to Form 122A-2 and applies the standardized National Standards, Local Standards, and Other Necessary Expenses deductions promulgated by the IRS, along with the secured-debt and priority-debt deductions specified by section 707(b)(2)(A)(iii) and (iv).
The deep-dives below treat each form and the rebuttal framework in turn, covering the line-by-line calculation, the principal interpretive disputes (including the Hamilton v. Lanning framework for projected disposable income in Chapter 13), and the practical mechanics of the presumed-abuse rebuttal.
Form-by-form deep-dives
- Form 122A-1 - Chapter 7 Statement of Current Monthly IncomeThe Chapter 7 CMI calculation, the six-month lookback window, the inclusion and exclusion rules for various income sources, the marital-adjustment line, and the median-income comparison.
- Form 122A-2 - Chapter 7 Means Test DeductionsThe IRS National Standards, the Local Standards housing and transportation allowances, the Other Necessary Expenses category, the secured-debt and priority-debt deductions, and the disposable-income computation that triggers the presumption.
- Form 122C - Chapter 13 Statement of Current Monthly IncomeThe Chapter 13 CMI and disposable-income calculation, the applicable-commitment-period determination, and the projected-disposable-income framework articulated by Hamilton v. Lanning.
- Presumed Abuse RebuttalThe section 707(b)(2)(B) special-circumstances rebuttal, the documentation and itemization requirements, the totality-of-circumstances analysis under section 707(b)(3), and the United States Trustee's role.