Texas Chapter 7 Means Test Calculator: Income, Deductions, Exemptions

You qualify for Chapter 7 bankruptcy under the Texas means test if your household income falls below the state median for your household size, or if it exceeds the median but your allowed expense deductions leave too little monthly disposable income to fund a Chapter 13 repayment plan. For a single earner filing on or after April 1, 2026, the median threshold is $66,837 per year.¹ Clear the median and you pass automatically. Exceed it and the test continues with a detailed expense calculation on Form 122A-2.

The Texas Median Income Shortcut

Add up every dollar your household received during the six full calendar months before your filing date. Divide by six for a monthly average, then multiply by twelve. If the annualized figure comes in under the Texas median for your household size, the test is over and you qualify.

For cases filed on or after April 1, 2026, the Texas thresholds are:

1 earner: $66,837
2-person household: $86,714
3-person household: $99,273
4-person household: $117,962
Each additional person: add $11,100

The Census Bureau updates these numbers periodically and the U.S. Trustee Program publishes the current table, so use whichever version is in effect on your actual filing date.¹ Below the line, you stop. Above it, you move to the deduction phase.

What Counts as Current Monthly Income

“Current monthly income” is a defined term in federal bankruptcy law, and it is broader than a paycheck. It covers the average monthly income from all sources received during the six-month period ending on the last day of the calendar month before you file.² That includes wages, salary, overtime, bonuses, commissions, rental income, business income, pension and retirement distributions, interest, dividends, and regular financial contributions anyone else makes toward your household expenses. If a relative routinely helps with your rent or groceries, that money counts.

You report gross amounts, before any payroll deduction for taxes, insurance, or retirement contributions, on Official Form 122A-1.³ Gather six months of pay stubs, bank statements, and tax records before you start.

A short list of income sources is excluded. Social Security benefits of any kind do not count. Neither do payments to victims of war crimes or terrorism, or certain veterans’ disability compensation tied to combat-related injuries.²

If You’re Married and Filing Alone

Your spouse’s income gets pulled into the initial calculation even if your spouse is not filing with you. This catches many Texas filers off guard. You can then subtract any portion of your spouse’s income that does not go toward household expenses, through what’s called the marital adjustment on Form 122A-2. Common items include your spouse’s student loan payments, support obligations to a prior household, and payroll deductions that benefit only your spouse. The point is to isolate the income actually available to your household.

If You’re Above the Median: Allowed Expense Deductions

Exceeding the median does not disqualify you. It moves you to Form 122A-2, where you subtract a set of allowed expenses from current monthly income. Most of the categories use standardized figures rather than what you actually spend.

IRS National and Local Standards

The IRS publishes national standards for food, clothing, household supplies, personal care, and out-of-pocket healthcare. You get the full national standard for your family size regardless of what you actually spend, with healthcare allowances calculated per person.⁴

Housing, utilities, and transportation use local standards that vary by county. Texas is big, and the Harris County housing allowance looks very different from the figure for a rural West Texas county. For housing and transportation you use the lesser of the local standard or your actual expense. Housing is usually the largest line on the form, so this is where the calculation often turns.

Deductions Beyond the IRS Standards

Several additional categories get overlooked:

Actual monthly premiums for health insurance, disability insurance, and HSA contributions for yourself, your spouse, and dependents. If you currently lack coverage, you can price a reasonable policy and deduct that amount.⁵
Actual monthly expenses for the care of an elderly, chronically ill, or disabled household member or immediate family member who cannot cover those costs themselves.⁶
Up to $189.58 per month per child for private or public elementary or secondary school expenses, for children under 18.⁵
Additional food and clothing costs, up to 5% of the national standard allowance, if your actual spending exceeds the standard.⁶
Ongoing cash donations to religious or charitable organizations that you intend to continue making.⁵
Expenses reasonably necessary to maintain your safety or your family’s safety from domestic violence.⁶

You also deduct average monthly payments on secured debts such as mortgages and car loans. The math is simple: total the contractually required payments over the next 60 months, then divide by 60. Amounts needed to cure arrears on your home or vehicle are deductible, and priority debts like back taxes and domestic support obligations work the same way.⁵

The Disposable Income Thresholds

Subtract every allowed deduction from your current monthly income, then multiply what remains by 60 (a five-year repayment window). That total determines whether a “presumption of abuse” arises, meaning the court presumes you have enough to repay creditors through Chapter 13 instead.

For cases filed in 2026, the thresholds are:⁷

60-month total below $10,275: no presumption. You qualify for Chapter 7.
60-month total above $17,150: presumption of abuse applies. You are expected to be in Chapter 13 unless you can show special circumstances.
60-month total between $10,275 and $17,150: the presumption applies only if that amount equals or exceeds 25% of your nonpriority unsecured debt. Below 25%, no presumption.

In monthly terms, roughly $171 and $286 mark the two edges. Stay below about $171 of monthly disposable income and no presumption issue arises. Above about $286 the presumption applies regardless of debt level. Between those figures, the size of your unsecured debt decides it.

Who Is Exempt from the Means Test Entirely

Two categories of filers skip the test altogether.

Primarily Non-Consumer Debt

The means test applies only to individuals whose debts are primarily consumer debts. If more than half of your total debt is business-related rather than personal, you are exempt.⁶ Small business owners, independent contractors, and entrepreneurs carrying debt from failed ventures, commercial leases, or equipment financing often fit this exemption. If those obligations outweigh your personal credit card balances and medical bills, income is not a barrier.

Qualifying Military Service

Members of the National Guard and reserve components called to active duty or who performed homeland defense activity for at least 90 days after September 11, 2001, are exempt during their service and for 540 days after it ends.⁶ Disabled veterans whose debts were incurred primarily during active duty or homeland defense activity are also exempt, with no time limit on that protection.

If the Presumption of Abuse Applies

Triggering the presumption does not automatically end your Chapter 7 case. You can try to rebut it by documenting “special circumstances” that justify additional expenses or income adjustments the standard formula missed. The bankruptcy code specifically mentions a serious medical condition or a call to active military duty, but the category is not limited to those examples.⁶ Each circumstance has to be documented in detail with a dollar amount, and you must show that no reasonable alternative exists. Courts scrutinize these claims closely, and vague descriptions of financial hardship will not carry the argument.

If you cannot rebut, you have two paths. You can convert the case voluntarily to Chapter 13 and enter a three-to-five-year repayment plan. Or you can ask the court to dismiss the case, though the trustee may object to dismissal, and a dismissal can limit the automatic stay protections available on any later refiling.

Both paths are expensive compared with running the numbers accurately beforehand. Attorney fees for a Chapter 7 case in Texas generally range from about $800 to $2,500 depending on the complexity of your finances, and most bankruptcy attorneys will evaluate your means test results during an initial consultation. Spending a few hundred dollars to learn you do not qualify is cheaper than filing, failing, and starting over under Chapter 13 with new fees and new costs.

1
U.S. Trustee Program/Dept. of Justice. Census Bureau Median Family Income By Family Size – Cases Filed On or After April 1, 2026
2
Office of the Law Revision Counsel. 11 USC 101 – Definitions
3
United States Courts. Chapter 7 Statement of Your Current Monthly Income
4
Internal Revenue Service. Collection Financial Standards
5
United States Courts. Chapter 7 Means Test Calculation – Official Form 122A-2
6
Office of the Law Revision Counsel. 11 USC 707 – Dismissal of a Case or Conversion to a Case Under Chapter 11 or 13
7
Federal Register. Adjustment of Certain Dollar Amounts Applicable to Bankruptcy Cases