The means test compares your household's gross income over the six full calendar months before filing against the California median for a household your size. Under the median, you qualify for Chapter 7 at step one. Over it, a second calculation subtracts allowed expenses to see what's left each month. Most of our Los Angeles clients pass at step one.
Step one: six months of income, doubled
The test starts with a window. Take the six full calendar months before the month you file, add up every dollar of gross income the household received in that window, divide by six, and multiply by twelve. That's your "current monthly income" annualized, and it is the only number step one cares about.
Then compare it to the California median for your household size. For cases filed on or after April 1, 2026, the figures are $79,253 for one person, $102,797 for two, $116,541 for three, and $139,071 for four, with $11,100 added for each person after that. The full table, and how to count the people in your household, is on our page on California median income by household size.
Below the line, you're done. There is no long form, no expense analysis, no presumption of abuse. You file Chapter 7.
What counts as income, and what doesn't
Gross, not net. Wages before taxes and before the 401(k) deduction. Overtime, bonuses, commissions, tips you reported. Net profit from self-employment (gross receipts minus ordinary business expenses). Rental income. Unemployment benefits, which the trustees in the Central District treat as income. Child support and spousal support you receive. Regular help from a parent or partner who pays your rent every month counts too, because the form asks about contributions to household expenses.
Social Security benefits are excluded, and that includes SSDI. A one-time gift for a car repair generally isn't income. A tax refund isn't income for this purpose, although it can matter as an asset on filing day.
If you're married and filing alone, your spouse's income goes on the form. You then back out the part of it that isn't used for household expenses, which is called the marital adjustment. That's where a lot of one-spouse filings live or die, and it's worth getting right.
A worked example with real numbers
Say a couple in Culver City wants to file in September 2026. The window is March through August. She's a hospital scheduler paid $4,300 a month gross. He drives for a delivery contractor and nets about $3,100 a month after fuel and insurance, except June, when he cleared $4,800.
| Month | Her wages | His net profit | Household total |
|---|---|---|---|
| March | $4,300 | $3,100 | $7,400 |
| April | $4,300 | $3,100 | $7,400 |
| May | $4,300 | $3,100 | $7,400 |
| June | $4,300 | $4,800 | $9,100 |
| July | $4,300 | $3,100 | $7,400 |
| August | $4,300 | $3,100 | $7,400 |
| Six-month total | $46,100 |
$46,100 divided by six is $7,683.33 a month. Times twelve is $92,200. The two-person median is $102,797. They pass by more than $10,000, and June's good month didn't hurt them.
Now change one fact. Give her a $14,000 bonus in April. The six-month total becomes $60,100, the annualized figure $120,200, and they're over. Wait until October to file and April drops out of the window. The total falls back to $46,100 and they pass. Same people, same debts, different month.
Step two: the long form
Over the median, the form keeps going. You now subtract a list of allowed expenses from your current monthly income. Some are fixed by IRS standards for Los Angeles County (food, clothing, housing, utilities, vehicle operation), and you get the standard number even if you spend less. Others are your actual figures: the mortgage or car payment, averaged over 60 months, taxes withheld, health insurance, court-ordered support, childcare, term life insurance, and secured debt you intend to keep paying.
What's left is your monthly disposable income. Multiply it by 60. If that number is under a floor currently in the neighborhood of $9,000, you pass. Above a ceiling around $15,000, abuse is presumed and Chapter 7 is off the table unless you can show special circumstances. In between, the test compares the 60-month figure to 25% of your unsecured debt.
The long form is where a $1,200 car payment can push someone through and a $400 one can't. It's also where people who prepare their own petition make expensive errors, usually by leaving out deductions they were entitled to.
Failing the test isn't the end of the conversation
Three things happen when the numbers don't work.
Sometimes we wait. The window moves on the first of every month, and a severance payment or a bonus falls out of it eventually. Sometimes the debts are mostly business debts rather than consumer debts, and the means test doesn't apply at all. The rest of the time the answer is Chapter 13, which is built for people with income above the median and comes with its own advantages. We lay out the tradeoffs on Chapter 7 versus Chapter 13.
One thing does not happen: nobody is forced into a payment plan because a form said so. The form is a starting point. If the long form says you pass by $40, the U.S. Trustee's office may still take a look, and if it says you fail by $40, there are usually deductions to revisit.
What we need from you to run it
Pay stubs covering the full six months, or a year-to-date stub plus the ones we're missing. Bank statements for the same window, because deposits are how the trustee checks the stubs. Profit-and-loss figures if you're self-employed, month by month, not a yearly total. The last two years of tax returns. Any support order.
We run the test on the first call whenever the caller has rough numbers, and we run it properly once the documents arrive. It takes about twenty minutes and it's the first real gate in a Chapter 7 case. Nobody should pay a fee before knowing they're through it.
The bonus month is what gets people. Someone calls in May, has a $9,000 retention payment sitting in the February column, and wants to file tomorrow. I tell them to give me until September. They hate hearing it, because the calls don't stop while we wait. But the alternative is a long form that may not work, or a Chapter 13 they didn't need. Four months of patience against five years of payments. I've never had anyone regret waiting, and I've had a few who wished they had.
Questions people ask about this
Is the means test based on gross or net income?
Gross. The form uses income before taxes, before retirement contributions, and before health insurance premiums come out. Those deductions come back into play only on the long form if you're over the median.
Does my spouse's income count if I file alone?
Yes, it goes on the form. You then subtract the portion of it that isn't spent on household expenses, such as your spouse's own car payment or student loan. What remains is treated as household income. In a community property state like California the trustee looks closely at that adjustment.
Does unemployment count as income on the means test?
In practice, yes. Trustees in the Central District expect to see unemployment benefits included in current monthly income. Social Security benefits, including SSDI, are excluded by statute.
What if my income dropped recently?
The test only looks backward, so a layoff last week doesn't change the six-month average. But if you're over the median because of income you no longer have, that's a classic special circumstance, and often the better move is to wait a month or two for the window to shift.
Can I file Chapter 7 if I'm over the median?
Often, yes. The median is only step one. Plenty of people over the median pass the long form because their mortgage, car payments, taxes and support obligations eat the difference. The long form is a real analysis, not a rubber stamp.
Talk it through with the attorney
Bring six months of pay stubs to a free video consultation and Naomi will run the means test with you on the call. If you don't pass this month, you'll know what month you will.