If your income is under median, then you are automatically eligible for chapter 7 based on your income. However, if your income is over median, then it gets a little more complicated. We must satisfy a formula called “the means test.” The means test is a somewhat complicated form, very similar to a tax return, where we input your gross income and take several types of allowed deductions.

The purpose of the means test is to calculate whether or not you have the “means” to pay back at least some of your debt in a chapter 13. If you pass the means test, (meaning that you do not have the “means” to pay back any of your debt) then you are still eligible for chapter 7, despite your high income. However, if you fail the means test, it means that at least on paper, you have the “means” to pay back some of your debt, and so you would be required to file chapter 13.