Where the means test came from
The means test was added to the Bankruptcy Code by the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) of 2005. Congress enacted the test to restrict Chapter 7 relief for debtors presumed to have the means to pay a meaningful portion of their debts in a Chapter 13 plan.
The test has two stages: first, comparison of the debtor's current monthly income to the applicable state median; and second, if income exceeds median, a deduction-based calculation that generates a presumption of abuse if monthly disposable income exceeds specified thresholds.
Current monthly income
Section 101(10A) defines "current monthly income" (CMI) as the average monthly income the debtor received during the six-month period ending on the last day of the calendar month before the petition date. CMI includes nearly all sources — wages, business income, rental income, interest, and most regular household contributions — with limited statutory exclusions (Social Security, certain military payments, victim-of-crime payments).
Median-income comparison
The debtor's annualized CMI is compared to the applicable state's median family income for a household of the same size, as published by the US Census Bureau and adjusted by the US Trustee Program. If CMI falls at or below median, the means test is completed on Official Form 122A-1 and the debtor qualifies for Chapter 7 without further calculation.
Form 122A-2 deduction calculation
Above-median debtors complete Form 122A-2, which subtracts allowable expenses from CMI to arrive at monthly disposable income over 60 months. Categories of allowed deductions include IRS-derived national and local standards for food, housing, and transportation; actual deductions for secured debt payments over the next 60 months; priority debt; and certain additional expenses documented by the debtor.
The presumption of abuse
§ 707(b)(2) establishes a presumption of abuse if monthly disposable income multiplied by 60 exceeds the greater of 25% of non-priority unsecured claims or a statutory floor amount (adjusted periodically under § 104). A triggered presumption results in dismissal or conversion to Chapter 13, subject to rebuttal by the debtor for special circumstances.
- If the means test shows no presumption of abuse, the Chapter 7 case proceeds.
- If the presumption is triggered, the US Trustee or any party in interest may move to dismiss or convert under § 707(b).
- Special-circumstances rebuttal under § 707(b)(2)(B) requires documented unavoidable expenses or reduced income not otherwise accounted for.
- Debtors whose debts are primarily non-consumer (business) are exempt from § 707(b).
Post-BAPCPA empirical observations
Published research on BAPCPA's effects has found that the means test did shift some filings from Chapter 7 to Chapter 13, while also imposing substantial compliance costs. The Federal Judicial Center's Integrated Database shows filing volume in both chapters has moved with broader economic cycles in ways not easily separable from the test's effect.
The national district index publishes chapter-mix ratios for every US federal bankruptcy district, which lets readers compare post-BAPCPA chapter distributions across jurisdictions.
Related resources
Chapter 7 vs Chapter 13
Factual comparison of the two chapters and their eligibility differences.
Fee guide
Filing fees, fee waivers, and § 329 attorney compensation review.
District case index
Chapter mix and filing trend data for every US bankruptcy district.
Frequently asked questions
What is the Chapter 7 means test?
The means test is a two-step calculation under 11 U.S.C. § 707(b) that screens Chapter 7 eligibility. Step one compares the debtor's current monthly income to the applicable state median. Step two, if needed, calculates monthly disposable income and creates a presumption of abuse if the disposable-income threshold is exceeded.
What is "current monthly income" for the means test?
11 U.S.C. § 101(10A) defines CMI as the debtor's average monthly income over the six-month period ending the last day of the calendar month before the petition. It includes nearly all sources of income, with specific statutory exclusions.
Where do the median-income numbers come from?
The US Trustee Program publishes median-income figures at justice.gov/ust/means-testing based on US Census Bureau data. The figures are updated approximately every six months.
Am I required to take the means test?
Every Chapter 7 consumer debtor must complete Form 122A-1, and above-median debtors must complete Form 122A-2. Debtors whose debts are primarily non-consumer are exempt from § 707(b) presumption-of-abuse analysis.
What happens if the presumption of abuse is triggered?
The US Trustee or any party in interest may move to dismiss the case or convert it to Chapter 13 under § 707(b). The debtor may rebut the presumption by showing special circumstances under § 707(b)(2)(B).