Chapter 7 allows you to eliminate unsecured debt such as credit card debt, medical bills, and auto repossessions; however,  non-exempt assets are not protected and they can be sold by the trustee.   Liens, like mortgages and car loans, are not changed by Chapter 7.

The Means Test

The means test determines whether you qualify for relief under chapter 7.  11 U.S.C. §§ 101(41), 109(b)

If your “current monthly income”

  • (1) is more than the state median, the Bankruptcy Code requires application of a “means test” to determine whether the chapter 7 filing is presumptively abusive.  Abuse is presumed if the debtor’s aggregate current monthly income over 5 years, less certain statutorily allowed expenses (see below), is more than (i) $11,725, or (ii) 25% of the debtor’s nonpriority unsecured debt, as long as that amount is at least $7,025.


  • (2) you may rebut a presumption of abuse only by a showing of special circumstances that justify additional expenses or adjustments of current monthly income.  Unless the debtor overcomes the presumption of abuse, the case will generally be converted to chapter 13 (with the debtor’s consent) or will be dismissed. 11 U.S.C. § 707(b)(1).

US Trustee’s Notes on the Means Test

 Allowed Expenses

Allowable Living Expenses


Out of Pocket Health Care


Allowed Expenses: Utilities and Rent


Transportation Expenses