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Means Testing, Median Income, Safe Harbor


Once we know all the gross dollars you have earned in the last 6 months, we need to know if there is anybody else in your household. If you are married and your spouse is living with you, we need to know how much your spouse has grossed. If you have others in your home who contribute regularly to your monthly expenses, we need to know about that as well. Again, it’s our job to ask you the right questions and determine what your income is.
Once we get that number, we double it so it counts for one year. We then compare it to the median household income for your household size in your state. How do we come up with this median income number? We don’t. The government does. The numbers usually adjust every six months and they can be found at, where you can also find more information about whom the United States Trustee is and the role they will have in your bankruptcy.

How is household size determined?

Nobody really knows but there is a lot of room for argument. Many cases are straightforward. For example if you are married with two children and nobody else lives with you, you are a household of 4 and would use that median income number. But what if you have adult children in college? Parents living with you? Parents living away from you but you support them? The possibilities are endless and unless you have a straightforward situation, your household size must be analyzed by an attorney and we are happy to do that for you for free.
Once you know your household size, you compare your annualized number to the median income. If your number is under the median income, you qualify for what’s called the “safe harbor”. This means different things depending on which bankruptcy you file. If you are hoping to file chapter 7, and everything else about your situation dictates that you can and should file Chapter 7 bankruptcy, being in the safe harbor drastically simplifies your bankruptcy. If you file chapter 13 bankruptcy and fall within the safe harbor you may only have to make bankruptcy payments for 3 years (to read more about chapter 13 bankruptcy payments, please visit our chapter 13 bankruptcy page).
If you are over the median income, you are subject to full means testing, so please read Bankruptcy Means Testing (formal) which is Part 3 of our 'How to File Bankruptcy' series.


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