What is the “means test”?

Individual debtors with primarily consumer debts who file a petition for bankruptcy under Chapter 7, 11, or 13 must complete an income-based “means test.” The means test calculates the difference between a debtor’s current monthly income (“CMI”) and his or her allowed expenses. The means test is intended to determine whether a debtor has the “means” to repay some percentage of his or her non-priority unsecured debts. In order to report and calculate a debtor’s CMI and allowed expenses for the completion of the means test, official form B22A has been created for Chapter 7 debtors, B22B for individual 11 debtors, and B22C for Chapter 13 debtors. In a Chapter 7, the means test may determine whether there is a presumption of abuse by the debtor in seeking relief under Chapter 7. Forms B22B and B22C can be used in order to determine the appropriate payment plan for debtors in Chapters 11 and 13.