The means test determines whether you can file Chapter 7 bankruptcy. Your income is compared to the median income in New York for your household size. New York has among the highest median incomes in the nation, which means more residents qualify.
The means test is a calculation required for Chapter 7 bankruptcy that compares your income to the median income in your state. If your income is below the median for your household size, you automatically qualify for Chapter 7. If above, you must pass a second calculation that factors in your allowed expenses.
The means test was introduced by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA). Its purpose is to determine whether a debtor's Chapter 7 filing constitutes an "abuse" of the bankruptcy system based on income.
The test works in two parts:
New York's high cost of living translates to higher median income figures, which means the means test threshold is higher than in most states. More New Yorkers pass Part 1 automatically.
| Household Size | Annual Median Income | Monthly Equivalent |
|---|---|---|
| 1 person | $66,973 | $5,581 |
| 2 persons | $85,474 | $7,123 |
| 3 persons | $103,286 | $8,607 |
| 4 persons | $124,598 | $10,383 |
| Each additional person | Add approximately $9,900 | |
New York City filers are in the Southern District of New York. Courthouse: One Bowling Green, New York, NY 10004.
New York is one of the states that allows debtors to choose between the state exemption system and the federal exemption system under 11 U.S.C. section 522(d). You cannot mix and match - you must use one system entirely.
This choice can significantly affect the means test calculation in Part 2, because allowed deductions differ between the two systems. An experienced bankruptcy attorney will calculate both options to determine which protects more of your property and produces a better means test result.
1Calculate your current monthly income (CMI)
Add up all income from all sources for the six full calendar months before your filing date. Divide by six to get your average monthly income. Multiply by 12 for your annualized figure. Sources include wages, salary, tips, bonuses, overtime, self-employment income, rental income, pension, disability (non-Social Security), alimony received, and any other regular income.
2Determine your household size
Count everyone living in your household who depends on your income. This typically includes yourself, your spouse (even if not filing jointly), and dependent children. In multi-generational households common in New York City, this determination can be especially important.
3Compare to median income
Compare your annualized CMI to the New York median income for your household size (see table above). If your income is at or below the median, you pass the means test and qualify for Chapter 7. No further calculation is needed.
4If above median: Calculate allowable deductions
If your income exceeds the median, you proceed to Part 2. You deduct IRS-approved living expenses, actual secured debt payments (mortgage, car loans), priority debts, and certain other allowed expenses. New York City's high housing costs and commuting expenses can significantly reduce disposable income in this calculation.
5Calculate disposable income
Subtract your total allowed deductions from your CMI. Multiply by 60 (representing a 5-year Chapter 13 plan). If the result is less than $9,075, you pass. If more than $15,150, you fail. Between those amounts, further analysis is needed.
6File the appropriate form
The means test is filed on Official Form 122A-1 (Chapter 7 Statement of Your Current Monthly Income) and, if needed, Form 122A-2 (Chapter 7 Means Test Calculation). Your attorney will prepare these forms as part of your petition.
Failing the means test does not mean you cannot file bankruptcy. You have several options:
New York City bankruptcy cases are filed in the Southern District of New York. All five boroughs fall within the S.D.N.Y., though cases may be assigned to different courthouses:
Regardless of which borough you live in, the same New York state median income figures and exemptions apply. The S.D.N.Y. has its own local rules that may affect filing procedures, trustee assignments, and hearing schedules.
The means test compares your income to the median income in New York for your household size. If below, you qualify for Chapter 7 automatically. If above, a second calculation factors in allowed expenses. Learn more about the means test.
The 2026 New York thresholds are: 1-person $66,973, 2-person $85,474, 3-person $103,286, 4-person $124,598. Add approximately $9,900 for each additional person.
Yes. New York allows debtors to choose between state and federal exemptions under 11 U.S.C. section 522(d). You cannot mix and match. An attorney can determine which system protects more of your property.
You can file Chapter 13 instead (no means test), wait until your income drops, challenge with special circumstances, or re-examine deductions. Failing does not mean you cannot file bankruptcy.
No. The means test does not apply to Chapter 13. However, your income level determines whether your Chapter 13 plan lasts 3 years (below median) or 5 years (above median).
All income from all sources over the six months before filing, including wages, salary, tips, bonuses, overtime, business income, rental income, pension, and unemployment. Social Security benefits are excluded from the initial median income comparison.
Use the free 1328(f) screener to check whether a prior discharge affects your eligibility for a new bankruptcy discharge.
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