Arizona Chapter 7 Means Test Calculator: Estimate Qualification and Cost

 Before we start, this article is primarily for informational purposes. This is not construed as legal advice as we are not attorneys. However, you can schedule a free consultation with us if you'd like to speak with a bankruptcy lawyer in your area!
Information in this article does not constitute legal advice, it is for informational purposes only, and may not constitute the most up-to-date information. Readers should contact their attorney for advice on any particular legal matter.

If you're considering filing bankruptcy in Arizona, you may have heard about the Chapter 7 means test requirements. You might be curious about the qualifications and how to pass the means test. All of that and more will be covered.

  1. First, if your current household income is less than your family's median income, you might be eligible for Chapter 7 bankruptcy in Arizona. You can use the Arizona bankruptcy means test calculator below to receive an estimate of whether you meet this criterion. Remember that some incomes are not included in the means test, so you may want to consider that!
  2. Let's now assume that the income in your household is greater than the median income. You may still be able to qualify. You can use the Arizona bankruptcy means test calculator to determine your eligibility if you have any costs that might be deductible.

Arizona Bankruptcy Means Test Calculator

Let's discuss the bankruptcy means test and how it can be helpful to use it to see if you qualify.

First, you should be aware of the three US bankruptcy forms. We'll concentrate on the first one, the Chapter 7 Statement of Your Monthly Income form, used to estimate your qualification in the Arizona Chapter 7 Bankruptcy Calculator.

This calculator assists you in determining your eligibility for bankruptcy and the approximate cost of filing for bankruptcy in Arizona with legal representation. Below is a calculator for the means test in Arizona bankruptcy. With the most recent updated statistics for 2023–2024, you can determine your eligibility with reasonable accuracy.

Keep on reading to understand how Chapter 7 works in Arizona, or jump ahead to the section that interests you most.

Table of Contents

Chapter 7 Means Test Explanation

Passing the means test can be considered a crucial part of filing Chapter 7 Bankruptcy in Arizona. You fill out a standard form that determines your typical monthly income. But before you take this means test, you should know a few things, mainly if you live in Arizona. First, the test considers your household income unless you are officially separated, even if your spouse isn't filing with you.

This explains how the means test in Arizona determines your average monthly income. The average monthly income you received from all sources in the six months before filing for bankruptcy must be entered. Thus, if your filing date is September 15, you should consider the time frame from March 1 to August 31. Add up all your revenue and split it by six if it changed throughout those six months. Just mention it once if you and your spouse receive money from a rental property. Suppose you have nothing to report on a particular line; enter $0.

You may want to look at this average income calculator if your income varies. It will estimate your average monthly income and is specifically made for the Arizona means test.

Arizona Chapter 7 Bankruptcy Income Limit

Next, we will cover Arizona's Chapter 7 bankruptcy income limit as of November 1, 2023. First, it's important to remember that these numbers tend to change every six months or so. The data is arranged by household size and the corresponding median income. Here is the data:

# of PeopleAnnual Income

One thing to note is that you may be able to add $9,900 to the annual income limit for every additional household member.

What Is Considered Income?

Let's discuss means testing for bankruptcy and income. The test does not encompass all forms of income. Disability and social security income, for instance, are not considered. So, you don't need to worry if you're depending on those.

You may find that some income is included in the bankruptcy means test in Arizona. It consists of any consistent payments made by an individual other than the bankruptcy petitioner. These payments are intended to cover household expenses. Let's examine a few of the income streams that fit within this group:

  1. Salaried income: The amount you get paid each month.
  2. Spousal income: Your spouse's income is subject to challenge if you're in a joint case or aren't officially separated.
  3. Hourly and overtime pay: You can deduct any overtime you work.
  4. Net Rental Income: Any money you make from renting out real estate is included.
  5. Arizona government income: Your state payments are included on this list if you get any.
  6. Alimony and child support
  7. Royalties, Interest, and Dividends: funds from investments and entrepreneurial ventures
  8. Retirement and Pension Income
  9. Net business income: The money you make from your firm is included if you are the owner and operator.
  10. Payments for annuities
  11. Compensation for unemployment
  12. Benefits from Worker's Compensation

What Is Considered In Household Size?

One common question is how household size is genuinely calculated. For example, your roommate is not counted as part of your household.
In bankruptcy proceedings, the definition only pertains to all individuals financially connected within a single dwelling. This includes immediate family, dependents, and those who rely on or contribute to the household's resources.

Arizona Above Median Bankruptcy Means Test

If it looks like your income is higher than the household income level for Arizona, that doesn't mean you're automatically disqualified. There are two more means test forms that you can use to see if you still qualify for Chapter 7 bankruptcy.

The first form is called the "Statement of Exemption from Presumption of Abuse Under §707(b)(2)." It helps you show that even though your income is high, you still have valid reasons for seeking bankruptcy protection.

The second form is the "Chapter 7 Means Test Calculation." This allows you to deduct your allowable monthly expenses from your current income. Doing this lets you determine your disposable income and the amount left after paying for your expenses.

The expenses used in this calculation are a mix of national and Arizona expenses. So, it considers the specific cost of living in your state.

Just a quick note: disposable income is the money you have available to repay your debts after covering your expenses. If your disposable income falls below a certain amount, you might still be eligible for Chapter 7 bankruptcy.

That being said, you can take our Chapter 7 Arizona Bankruptcy Calculator to estimate your initial qualification before those specific deductions: 

Allowable deductible expenses

You can subtract certain actual expenses from your income on the second part of the test. These include required workplace deductions for retirement plans, union dues, and uniforms. In addition, you can write off payments for child care, term life insurance, health and disability insurance, income taxes, secured debt payments for your house and vehicle, alimony, child support, and even charitable contributions (though the amount of your income that can be written off is limited).

You can check out the current national standards here to determine the maximum amounts allowed for these expenses. They cover housekeeping supplies, clothing, food, personal care services and products, housing and utility expenses, transportation expenses, and out-of-pocket healthcare expenses. The premiums for health and disability insurance, income taxes, child care costs, term life insurance, secured debt payments for your home and vehicle, alimony, child support, and even charitable contributions are all deductible (though the amount you can deduct from your income is limited).

If you're unsure how your situation fits this criteria, contacting a local bankruptcy attorney in Arizona can sometimes be helpful. They can give you a free evaluation and help you navigate the process. You can find one right here.

What Happens If You Fail the Bankruptcy Means Test?

One possibility is to look into a Chapter 13 bankruptcy in Arizona. Another avenue worth exploring is checking out some alternatives to bankruptcy, like debt settlement, debt management, or debt payoff planning.

Chapter 13 Bankruptcy

There is still a chance to obtain some debt relief through Chapter 13 bankruptcy if your income exceeds the threshold for Chapter 7 bankruptcy. A Chapter 13 bankruptcy in Arizona enables you to reorganize your obligations into a monthly payment schedule that is easier to handle. With this reorganization, you can avoid foreclosure, keep your house and cars, and not have your possessions taken back. In addition, you may be eligible for a reduction in any arrears for vehicle loans, alimony, and child support.

Debt Settlement

In addition to Chapter 7 and Chapter 13 bankruptcy, debt settlement offers an alternative approach to managing overwhelming debt. By opting for debt settlement, you could save money in the long term as the settlement company negotiates a reduced amount on your overall debt. However, it's crucial to consider the potential impact on your credit score. Before committing to debt settlement, conduct thorough research to choose a reputable and transparent provider. Making an informed decision will help you navigate the complexities of debt management while minimizing the adverse effects on your finances.

Debt Management

Debt management is also an additional choice. Debt management firms aim to minimize your interest rates, while debt settlement companies try to reduce the overall amount of debt you owe. These programs are often more expensive than debt settlement and have three to five years duration. Furthermore, not every creditor could be open to working with a debt management business.

However, this alternative may lower your interest rate by around 10–20% if you have a lot of high-interest credit card debt. This might eventually result in savings of between 30 and 50 percent on the amount you already owe, and it will also enable you to pay off your bills more quickly. Everyone's situation is unique, so it can be helpful to review your type of debt and creditor mix.


Navigating the bankruptcy means test and income limit for Chapter 7 bankruptcy in Arizona may seem daunting, but it's a crucial step toward financial relief. Despite its complexity, many opt for Chapter 7 due to its cost-effectiveness compared to other debt-relief options. The means test evaluates how your household income stacks against the Arizona income limit, considering various exclusions.

If your household income exceeds the limit, don't lose hope. Qualifying for Chapter 7 in Arizona isn't solely dependent on income; your expenses and deductions also play a significant role. You may still be eligible for relief under Chapter 7 by carefully considering these factors.

There are alternative paths to explore, such as Chapter 13 bankruptcy, debt settlement, or debt management. Each option presents its own set of considerations and potential solutions, offering reassurance that there's most always a way forward, no matter the outcome of the means test.

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