The Means Test in Illinois: Do You Qualify for Chapter 7?

The means test is the gate every Chapter 7 filer has to walk through. It was added to the Bankruptcy Code in 2005 to keep higher earners out of Chapter 7, and the calculation is more involved than most online tools suggest. Getting it right matters: a failed means test means a case that either converts to Chapter 13 or gets dismissed.

Step one: the median income comparison

The first test compares your household's current monthly income — an average of the last six full calendar months, multiplied by twelve — to the Illinois median for a household of your size. As of the most recent Census Bureau data used by the U.S. Trustee, Illinois median annual income is approximately:

• 1 person — $67,000
• 2 people — $85,000
• 3 people — $103,000
• 4 people — $124,000
• Each additional person — add ~$9,900

These figures update every six months and vary slightly by filing date, so always confirm current numbers before relying on them. If your annualized income falls at or below the Illinois median for your household size, you pass — no step two required.

The six-month lookback trap

"Current monthly income" is not what you earn today. It is the average of the last six full calendar months before filing. A large bonus in January can still be counted in a July filing. Filing one month later can drop a large one-time payment out of the window entirely. This is one of the most common reasons we recommend timing.

What counts as income

• Gross wages, salary, tips, overtime, commissions
• Business and rental income (net)
• Interest, dividends, and royalties
• Pension and retirement payments
• Unemployment (courts split; Illinois generally includes)
• Regular contributions from others in the household

Social Security is specifically excluded from the means test calculation, even though it is included on Schedule I.

Step two: the expense analysis

If you are above median, you move to a detailed expense calculation that subtracts:

• IRS National Standards for food, clothing, personal care
• IRS Local Standards for housing and transportation
• Actual secured debt payments (mortgage, car loans) for the next 60 months, averaged
• Actual priority debt (recent taxes, support arrears) averaged over 60 months
• Health insurance, HSA, disability insurance, term life insurance
• Court-ordered payments and childcare

The result is your monthly disposable income. If that number, multiplied by 60, is less than roughly $9,075, you pass. If it is more than $15,150, you fail. Between those numbers, a further ratio test applies.

If you fail step one

Failing the means test does not mean bankruptcy is off the table. It usually means Chapter 13 instead of Chapter 7 — which has real advantages, especially if you are behind on a mortgage or owe recent taxes. Chapter 13 lets you catch up arrears over three to five years while the automatic stay holds creditors off.

Common ways to pass

• Waiting one to two months for a bonus to drop off the six-month average
• Including all household members, not just filers
• Documenting actual (not standard) secured debt payments
• Correctly classifying business income as net, not gross

The means test rewards preparation. A one-month delay in filing is often the difference between a straightforward Chapter 7 and a five-year Chapter 13 plan.

Run the numbers before you commit

We run the means test at the initial consultation using your actual pay stubs. If the number is close to a threshold, we will tell you whether a short delay is worth the wait. That analysis is free — and it is the single most valuable hour you will spend before filing.