Pennsylvania Bankruptcy Means Test | Chapter 7 Eligibility | Quinlan Law Group
Pennsylvania Bankruptcy Means Test — Do You Qualify for Chapter 7?
The means test under 11 U.S.C. §707(b) determines whether you are eligible to file Chapter 7 bankruptcy based on your income relative to Pennsylvania's median income for your household size. Many people assume they earn too much for Chapter 7 — and many of them are wrong. The means test has two steps, and a significant number of above-median income debtors pass the second step and qualify for Chapter 7. Quinlan Law Group runs the means test calculation as part of every free consultation.
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Step 1 — Compare your income to Pennsylvania median.
The means test uses your average monthly income over the six calendar months before filing, multiplied by 12 to get an annual figure. That figure is compared to Pennsylvania's current median income for your household size.
If your annualized income is at or below the Pennsylvania median — you pass the means test automatically. You are eligible for Chapter 7.
Current Pennsylvania median income figures (U.S. Trustee Program):
- Household of 1: approximately $57,000 per year.
- Household of 2: approximately $72,000 per year.
- Household of 3: approximately $85,000 per year.
- Household of 4: approximately $102,000 per year.
- Add approximately $9,000 for each additional household member above 4.
Step 2 — Disposable income calculation for above-median filers.
If your income exceeds the Pennsylvania median, the second step applies allowed expense deductions based on IRS National and Local Standards — standardized deductions for housing, food, transportation, healthcare, and other categories. These are IRS-set allowances that frequently exceed what debtors actually spend, creating significant deduction room.
After deducting allowed expenses from above-median income, if your monthly disposable income falls below the threshold set by 11 U.S.C. §707(b)(2), you pass the means test and qualify for Chapter 7 despite above-median income.
If you fail the means test, Chapter 13 remains available. The means test calculation also determines your Chapter 13 plan length: 36 months for below-median filers, 60 months for above-median filers.
What counts as income for the means test.
The means test captures all sources of income received in the six months before filing: wages, salary, self-employment income, rental income, interest and dividends, pension and retirement distributions, and regular contributions from household members. Social Security income is excluded from the means test calculation under 11 U.S.C. §101(10A).
Counties we serve.
Middle District: Adams, Bradford, Cameron, Carbon, Centre, Clinton, Columbia, Cumberland, Dauphin, Franklin, Fulton, Huntingdon, Juniata, Lackawanna, Lebanon, Luzerne, Lycoming, Mifflin, Monroe, Montour, Northumberland, Perry, Pike, Potter, Schuylkill, Snyder, Sullivan, Susquehanna, Tioga, Union, Wayne, Wyoming, and York County.
Eastern District: Berks, Bucks, Chester, Delaware, Lancaster, Lehigh, Montgomery, Northampton, and Philadelphia County.
The sooner we talk, the more we can do.
Call (717) 724-7503 | Schedule a free consultation
Quinlan Law Group | 3425 Simpson Ferry Rd, Suite 100, Camp Hill, PA 17011
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