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Means Test Calculations
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Ownership Cost Deductions
Deduct vehicle ownership costs, even if your vehicle is paid off, up to the local standard amount.
Disposable Income Calculation
Deduct allowable expenses from your CMI to determine your disposable income.
Out-of-Pocket Health Care Costs
Deduct monthly out-of-pocket health care costs not covered by insurance, using the National Standards.
Means Test Deductions for Housing and Utilities
Deduct your actual housing and utility expenses, subject to local standards.
Term of the Chapter 13 Plan
If you fail the Means Test, determine the length of your Chapter 13 repayment plan (either 3 or 5 years).
Secured Debt Payments
Deduct your average monthly payments for secured debts when calculating disposable income.
Eligibility for Filing Chapter 7
If your disposable income, after all deductions, can pay off some unsecured debt, you may not qualify for Chapter 7.
IRS National Standards for Expenses
Use the IRS National Standards for necessary expenses such as food, clothing, and health care.
Priority Non-Dischargeable Debt Payments
Include payments for priority debts like child support and taxes in your deductions.
Mandatory Payroll Deduction Deductions
Deduct mandatory payroll deductions such as retirement plan contributions and union dues.
Definition of the Means Test
The Means Test determines if your income is low enough for you to file for Chapter 7 bankruptcy.
Current Monthly Income (CMI)
Calculate your average monthly income over the past six months before filing.
Median Income Comparison
Compare your CMI to the median income for a household of your size in your state.
Transportation Costs Deductions
Deduct your actual transportation costs—public or personal vehicle—up to the IRS standards.
Tax Deductions
Deduct your average monthly tax obligations, including federal, state, and local taxes.
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