11 U.S.C. 707 is the section of the Bankruptcy Code that lets a court dismiss a Chapter 7 case. It runs on two tracks. Subsection (a) handles procedural failures — missed documents, unpaid fees, unreasonable delay. Subsection (b) targets financial abuse: filers whose income is high enough that wiping out debts through liquidation would be unfair to creditors. Between them, these provisions decide who actually gets to use Chapter 7 and who gets pushed into a repayment plan or out of bankruptcy altogether.
Dismissal for Cause Under Section 707(a)
Section 707(a) allows dismissal “for cause.” The statute lists three grounds, and the word “including” tells courts they can identify others.
- Unreasonable delay by the debtor that is prejudicial to creditors. Stalling on financial records, ignoring court orders, or otherwise dragging out the case can be enough.
- Nonpayment of any required filing fee. Chapter 7 has a federal filing fee, and if you don’t pay in full or keep up with installment payments, the case can go.
- Failure to file required documents. Within 15 days of filing your petition (longer if the court grants extra time), you must submit schedules of assets and liabilities, a schedule of current income and expenses, a statement of financial affairs, pay stubs from the prior 60 days, and the other items listed in 11 U.S.C. 521(a)(1). Miss that deadline and the U.S. Trustee has grounds to move to dismiss.
One ground courts enforce routinely without it being spelled out in 707(a) itself: skipping the 341 meeting of creditors. You have to appear, show ID, and answer questions under oath. Don’t show up, and the case is dismissed.
Dismissal for Abuse Under Section 707(b)
Section 707(b) applies only to individual debtors whose debts are primarily consumer debts — debts incurred for personal, family, or household purposes rather than business obligations. If granting Chapter 7 relief would be an abuse, the court can dismiss the case or, with the debtor’s consent, convert it to Chapter 11 or Chapter 13.
A motion to dismiss for abuse can come from the court on its own, the U.S. Trustee, the Chapter 7 trustee, or any party in interest. The statute provides three ways to find abuse: the means test presumption in 707(b)(2), a bad-faith inquiry under 707(b)(3), and a broader totality-of-the-circumstances review, also under 707(b)(3).
How the Means Test Works
The means test is the primary screen. It compares your income to your state’s median for a household your size and, if you’re above it, calculates whether you have enough disposable income left over to fund a plan.
Step One: Current Monthly Income
The starting figure is your “current monthly income,” the average of your income from all sources over the six full calendar months before you filed. That gets compared to the median family income for a household of your size in your state, using Census Bureau data that’s updated periodically. At or below the median, you pass automatically. No presumption of abuse arises and the inquiry usually stops there.
Step Two: Calculating Allowed Expenses
Above the median, the formula switches to a detailed expense calculation. It doesn’t use what you actually spend. It uses standardized IRS figures for five national categories — food, clothing, housekeeping supplies, personal care, and miscellaneous — plus local standards for housing, utilities, and transportation based on where you live. On top of those, you can deduct:
- Average monthly payments on secured debts (mortgages, car loans, similar obligations) over the 60 months following your filing date.
- Priority claims like child support and alimony, computed as the total priority debt divided by 60.
- Reasonably necessary health and disability insurance premiums and health savings account expenses.
- Up to $2,575 per year per dependent child under 18 for elementary or secondary education.
- Expenses for an elderly, chronically ill, or disabled household member or immediate family member.
- Costs reasonably necessary to protect the debtor and family from family violence.
- If you’d be eligible for Chapter 13, up to 10 percent of projected plan payments for administrative expenses.
The dollar figures in the means test are adjusted every three years. The numbers here reflect the April 1, 2025 adjustment and stay in effect through at least early 2028.
Step Three: The Presumption Threshold
Subtract allowed expenses from current monthly income, then multiply the remainder by 60. That five-year figure triggers a presumption of abuse if it is at least the lesser of:
- 25 percent of your nonpriority unsecured debts, or $10,275, whichever is greater; or
- $17,150.
Practically: if your projected disposable income over five years reaches $17,150, the presumption arises no matter how much unsecured debt you carry. Between $10,275 and $17,150, whether the presumption arises depends on your unsecured debt level. Below $10,275, the formula doesn’t produce a presumption.
Rebutting the Presumption
Once the presumption exists, the burden shifts to you. The only way out is showing “special circumstances” that justify additional expenses or income adjustments with no reasonable alternative. The statute names two examples: a serious medical condition and a call to active military duty. You have to itemize each circumstance, document it, and show that the adjustment is enough to push you below the threshold.
Bad Faith and the Totality of Circumstances
If the means test doesn’t produce a presumption, or you rebut it, the case can still be dismissed under Section 707(b)(3). That provision asks two separate questions: did you file in bad faith, and does the totality of your financial circumstances show abuse?
The statute doesn’t list bad-faith factors, so courts have developed their own. Common ones include filing to dodge a single large judgment rather than genuine financial distress, transferring assets shortly before filing, misrepresenting income or expenses, and running up debt with no intention to repay. The totality test is broader. Courts look at the overall financial picture, including any ability to repay outside the rigid formula, lavish spending, or an attempt to reject a personal services contract for financial reasons.
One item the court cannot count against you: charitable contributions to a qualified religious or charitable organization. Those are carved out of the abuse analysis by statute.
Military and Veteran Exemptions from the Means Test
Section 707(b)(2)(D) exempts certain service members and veterans from the means test entirely.
- Disabled veterans, as defined in 38 U.S.C. 3741(1), whose debts were incurred primarily while on active duty or performing a homeland defense activity, are not subject to the means test at all.
- Reservists and National Guard members called to active duty or performing homeland defense activity after September 11, 2001, for at least 90 days, are exempt during that service and for 540 days after release or the end of the activity.
This shields you only from means testing. A qualifying service member can still face dismissal for procedural cause under 707(a) or on bad-faith grounds under 707(b)(3).
Attorney Sanctions Under Section 707(b)(4)
Section 707 also polices the lawyer. Signing a bankruptcy petition certifies that the attorney conducted a reasonable investigation, that the petition is grounded in fact and warranted by existing law, that it doesn’t constitute an abuse under 707(b)(1), and that the attorney has no knowledge the schedules are incorrect.
If a trustee moves to dismiss for abuse, the court grants the motion, and the court also finds the debtor’s attorney violated Federal Rule of Bankruptcy Procedure 9011, the court can order the attorney to reimburse the trustee for all reasonable costs of bringing the motion, including attorney fees. The court can add a civil penalty payable to the trustee or U.S. Trustee. That’s the enforcement lever behind the means test: filing clear Chapter 13 cases as Chapter 7 exposes the attorney personally.
What a Dismissal Actually Costs You
The automatic stay ends the moment the case is dismissed. Everything it was holding back — lawsuits, wage garnishment, foreclosure — can restart immediately.
Most procedural dismissals are without prejudice, so you can refile once you fix the problem. There’s no mandatory waiting period built into a without-prejudice dismissal itself, but two rules can slow you down. Under 11 U.S.C. 109(g), a 180-day bar applies if your prior case was dismissed for willful failure to obey court orders or appear, or if you voluntarily dismissed after a creditor filed for relief from the automatic stay. That bar reaches across chapters, not just Chapter 7.
Refiling also weakens the automatic stay. If you had one case dismissed within the past year, the stay in the new case lasts only 30 days unless the court extends it on a showing of good faith. If you had two or more dismissed in the past year, no stay takes effect at all unless the court affirmatively grants one, and the court presumes bad faith when the earlier cases were dismissed for things like missing documents or not following a confirmed plan.
In abuse cases under 707(b), dismissal often isn’t the outcome. The court gives the debtor a choice to convert to Chapter 13 or Chapter 11 instead. Conversion keeps the case and the stay alive, but you have to propose a repayment plan that pays your disposable income to creditors over three to five years. For most debtors who fail the means test, that’s the real endpoint.