What Is the Bankruptcy Means Test and How Does It Work?

If you’re struggling with debt and considering Chapter 7 bankruptcy, the first step is passing the “means test.” But what exactly is the means test? And how can someone in a high-income area like Washington still qualify for debt relief? Here’s a practical breakdown of what the means test is and how a bankruptcy attorney can help you make the most of it.

What Is the Means Test?

The means test determines whether you qualify for Chapter 7 bankruptcy (also known as liquidation bankruptcy). It compares your household income to the median income for your state, adjusted for your household size. If your income falls below the state median, you typically qualify automatically. If it’s above, you can still qualify but you’ll need to show that after subtracting allowable expenses, you don’t have enough disposable income to repay your debts.

What Expenses Can Be Deducted?

The means test allows you to subtract a wide range of necessary expenses from your income. These can include:

• Income taxes – Federal, state, and local income tax obligations can be deducted.
  
  
• Medical and dental bills – Routine and unexpected medical costs like doctor visits, surgeries, dental work, or prescriptions.
  
  
• Mental health care – Costs for psychologists or therapists, and ongoing treatment plans.
  
  
• Prescription medication – Regular medication costs that aren't fully covered by insurance.
  
  
• Childcare expenses – Daycare, babysitters, and after-school programs if you’re working or attending school.
  
  
• Supporting family members – Financial support provided to elderly parents, adult children, or other dependents can be included.
  
  

Real-Life Help: Why a Bankruptcy Attorney Matters

One of the biggest challenges for individuals is knowing what qualifies as an allowable deduction, and remembering everything that should be included. When you work with our firm, we don’t just run the numbers once. We’ll go through the means test line by line, asking questions to uncover expenses you might not have considered. Our process is designed to make sure you get credit for every legitimate deduction you’re entitled to.

Even in High-Income Areas, Relief Is Possible

Washington has a higher median income than many states, especially in urban and suburban areas. But that doesn’t automatically disqualify you. We routinely help people in high-income households pass the means test based on their actual financial burdens. The test isn’t about what you earn, it’s more about what’s left over after covering necessary costs of living.

Talk to a Professional Before You Rule Yourself Out

If you’re overwhelmed by debt but assume you make too much to file, don’t count yourself out just yet. The means test is more flexible than many people think. Speaking with a qualified bankruptcy attorney can make all the difference.

If you’re considering Chapter 7 but think you may be over the income limit, contact us today. We’ll evaluate your situation and help determine if you qualify to pass the means test.