In order to determine your eligibility for a Chapter 7 Bankruptcy, you will need to pass the “Means Test.” This test compares your income to the median income of the same household size in your state. Your previous six months income is used when calculating the Means Test to determine your yearly gross income. The same information is also used in a Chapter 13 Bankruptcy to help determine your monthly plan payments. Bankruptcy Means Test Median Income figures are periodically adjusted and published by the Census Bureau.

As of the most recent update, the following figures apply to Bankruptcy cases filed in Texas as of April 1, 2020:

  • Family of 1: $50,902
  • Family of 2: $66,899
  • Family of 3: $73,948
  • Family of 4: $86,259
  • For families that have more than 4 people, add $9,000 for each additional family member

If you would like to find the most up to date on Bankruptcy Median Income amounts for your state, you can visit the United States Department of Justice website.

Even if you are above median income according to these figures, you may still qualify for a Chapter 7. The Means Test also takes certain allowable expenses into consideration. These expenses include taxes and withholding from your paycheck, living expenses, payments on secured debts such as your mortgage or car, child support payments, health costs, and more. A Houston, Texas bankruptcy lawyer can help you complete the Means Test to see if you are able to file bankruptcy under Chapter 7.

Contact us today if you have questions about the Means Test or your eligibility for a Chapter 7 Bankruptcy. We offer free initial consultations that include a Means Test analysis.