What Is the Income Limit for Filing Chapter 7?

There is no single dollar figure that serves as the income limit for filing Chapter 7 bankruptcy. Eligibility turns on how your household income compares to the median income for a household of your size in your state, and, if you’re above that median, on a second calculation called the means test. State medians for a single earner currently run from roughly $58,000 to $84,000, and they rise with each additional household member.¹

The State Median Is the First Cutoff

The first thing the court looks at is your “current monthly income,” a bankruptcy-specific term that means the average of all gross income you received from every source during the six full calendar months before you file. That includes wages, self-employment earnings, rental income, investment returns, and regular financial contributions from other people in your household.² Multiply that six-month average by 12 and you get the annualized number that gets compared to the state median.

The U.S. Trustee Program publishes updated median tables each spring and fall, drawing on Census Bureau data.³ A few examples from the table effective for cases filed on or after November 1, 2025:

Texas: $65,123 for one earner, $84,491 for two people, $96,728 for three, $114,938 for four
California: $77,221, $100,161, $113,553, and $135,505 respectively
New York: $71,393, $90,520, $112,616, and $135,475 respectively

For households larger than four, add $11,100 per year for each additional person.¹ If your annualized figure lands at or below the median for your state and household size, you clear the income screen. The court cannot dismiss your case for abuse based on your income alone, and you don’t have to complete the means test.

One thing to watch: the six-month lookback averages recent income, so a stretch of overtime or a one-time bonus in that window can lift you above the median even if your pay has since dropped. Timing your filing matters.

What Counts as Income, and What Doesn’t

Not everything you receive goes into the calculation. Social Security benefits are fully excluded, which keeps retirees and people receiving Social Security disability from being pushed over the median by benefits they rely on.² Certain veterans’ payments are also excluded, including disability compensation, combat-related pay, and survivor benefits paid under federal military statutes. Payments to victims of terrorism and war crimes are left out as well.

Income that does count: wages, self-employment earnings, unemployment benefits, pension and retirement distributions, rental income, interest, dividends, and regular contributions from a spouse or household member toward shared expenses.

The Means Test for Above-Median Filers

If your annualized income is above the state median, you’re not disqualified. You move on to the means test, a formula in federal bankruptcy law that measures how much disposable income you actually have after allowed expenses.⁴ The question the test is trying to answer is whether you could realistically fund a Chapter 13 repayment plan instead of erasing your debts in Chapter 7.

The formula subtracts allowed expenses from your current monthly income to get monthly disposable income, then multiplies that by 60 (five years of hypothetical repayment). Where that 60-month number lands sets the outcome:

Below $9,075: no presumption of abuse. You qualify.
Above $15,150: presumption of abuse. You generally cannot file Chapter 7.
Between $9,075 and $15,150: you qualify only if that number is less than 25% of your total nonpriority unsecured debt, meaning debts like credit cards and medical bills.

These thresholds apply to cases filed between April 1, 2025, and March 31, 2028, and are adjusted periodically.⁴

Deductions That Bring Disposable Income Down

The reason above-median filers routinely still qualify is the length of the allowed-expense list. Basic living costs like food, clothing, personal care, and out-of-pocket healthcare come off automatically at IRS-published National Standard amounts, which vary only by household size. Housing, utilities, and transportation come off at IRS Local Standards tied to your county and region.³ You don’t have to prove you actually spend those amounts.

On top of the standardized allowances, you can deduct actual monthly spending in several categories:⁵

Federal, state, and local income taxes, Social Security, and Medicare (net of any expected refund divided by 12)
Mandatory payroll deductions like required retirement contributions, union dues, and employer-required uniforms
Term life, health, and disability insurance premiums, plus health savings account contributions
Court-ordered child support and alimony
Average monthly payments on secured debts, calculated by totaling the next 60 months of payments on mortgages and vehicle loans and dividing by 60
Education costs required by your job, private schooling for a physically or mentally challenged dependent without a public alternative, and up to $189.58 per month per child under 18 for school expenses
Ongoing cash charitable contributions to religious or charitable organizations

These deductions are why someone earning $90,000 with a mortgage, car loans, and significant medical premiums can still pass. Gross income above the median isn’t the end of the analysis; disposable income after allowed expenses is.

Rebutting a Presumption of Abuse

Even if the numbers produce a presumption of abuse, you can rebut it by showing “special circumstances” that justify additional expenses or a reduction in income not reflected in the formula. The statute names two examples: a serious medical condition and a call or order to active military duty. Courts have considered others, such as large non-dischargeable student loan obligations, with results varying by jurisdiction. You have to document the circumstance with specific evidence and explain why it isn’t already captured by the standard deductions.

Married Filers: The Non-Filing Spouse

If you’re married and living with your spouse but filing alone, your spouse’s income has to be included in the initial income calculation, even though your spouse isn’t filing.⁶ That can push a combined household above the median on paper.

The means test lets you take a “marital adjustment” for portions of your spouse’s income that aren’t used to pay household expenses for you or your dependents. Typical deductible items include the non-filing spouse’s own tax withholdings, their student loan payments, support obligations for people who aren’t your dependents, and debt payments where only the non-filing spouse is legally responsible and the loan exclusively benefited them. Credit card payments used for shared household expenses can’t be deducted. If you’re legally separated under state law and living apart for reasons unrelated to the bankruptcy, you don’t include your spouse’s income at all.

Filers Who Skip the Income Test Entirely

Some filers don’t have to run the means test regardless of what they earn.

Disabled veterans are exempt if their debts were incurred primarily while on active duty or performing a homeland defense activity.⁴ “Disabled” here means a VA disability rating of at least 30%, or a military discharge because of a disability sustained in the line of duty. You claim the exemption by filing Official Form 122A-1Supp with your petition.

National Guard members and reservists who served on active duty or performed homeland defense activity for at least 90 days after September 11, 2001, are also exempt during that service and for 540 days after it ends.⁷

And if more than half of your total debt is non-consumer debt (business debts, large tax liabilities, debts from failed commercial ventures), the means test doesn’t apply. The presumption of abuse is aimed at consumer debt situations, so business-driven financial distress is evaluated on different terms.

If Your Income Is Too High to Pass

Failing the means test doesn’t leave you without options. The U.S. Trustee or a creditor can file a motion to dismiss your Chapter 7 case for abuse, but you can respond in several ways.⁸

Convert to Chapter 13, which lets you keep your property and repay debts through a three-to-five-year plan based on your disposable income. Conversion is generally available as long as the case hasn’t already been converted from another chapter.⁹
Rebut the presumption of abuse with documented special circumstances, as described above.
Ask the court to dismiss the case voluntarily and pursue alternatives like negotiated settlements with creditors.

The short version: there is no income number that automatically shuts you out of Chapter 7. Your state’s median is the first gate, and if you’re above it, the means test and its long list of allowed expenses is the second. Many people who assume they earn too much still qualify once the calculation is actually run.

1
U.S. Department of Justice. Median Income Data for Cases Filed on or After November 1, 2025
2
Office of the Law Revision Counsel. 11 U.S. Code 101 – Definitions
3
U.S. Department of Justice. Means Testing
4
Office of the Law Revision Counsel. 11 U.S.C. 707 – Dismissal of a Case or Conversion to a Case Under Chapter 11 or 13
5
United States Courts. Official Form 122A-2 Chapter 7 Means Test Calculation
6
U.S. Department of Justice. Chapter 7 Line by Line Means Test Analysis
7
United States Courts. Official Form 122A-1Supp – Statement of Exemption from Presumption of Abuse Under 707(b)(2)
8
United States Courts. Chapter 7 – Bankruptcy Basics
9
Legal Information Institute. Chapter 13 Plan