Understanding Chapter 7 Eligibility Doesn’t Have to Be Complicated
Many people assume they don’t qualify for Chapter 7 bankruptcy because of income—or because they’ve heard about the “means test.” In reality, the rules are more flexible than most people realize. Vaughn & Associates helps individuals across Cleveland and Northeast Ohio understand Chapter 7 eligibility, apply the means test correctly, and determine whether bankruptcy can offer a fast, effective path to debt relief. You don’t need to guess at the numbers—we’ll evaluate everything for you.
How Chapter 7 Bankruptcy Works — Step by Step
The Chapter 7 means test is a financial formula used to determine whether you’re eligible to file Chapter 7 bankruptcy. It is designed to measure whether you have enough disposable income to repay creditors.
In simple terms, the test works in two main steps:
01
Income Comparison
Your household’s average monthly income is compared to the Ohio median income for a household of your size. These figures change periodically and differ for a single filer, a couple, or a family with children.
- If your income is below the Ohio median, you typically qualify.
- If your income is above the median, you move to step two.
02
Disposable Income Analysis
If your income exceeds the median, the test looks at allowable expenses—such as housing, transportation, healthcare, taxes, and other necessary costs—to determine whether you have meaningful disposable income available to repay debts.
Many people who assume they’re “over the limit” still qualify once expenses are properly applied.
How Ohio Income Guidelines Affect Your Case
Ohio median income thresholds vary by household size and are updated regularly. Publishing exact figures online can quickly become outdated, which is why personalized evaluation is essential. What matters most is how your real-world expenses interact with the means test—not just your gross income.
We regularly help clients throughout Northeast Ohio who believed they earned too much, only to discover that they qualify for Chapter 7 after a proper analysis.
Additional Eligibility Rules to Know
Beyond the means test, Chapter 7 eligibility also depends on several other factors:
You must complete an approved credit counseling course before filing
You cannot have received a Chapter 7 discharge within the past 8 years
You must file accurate and complete financial disclosures
Certain types of prior bankruptcy filings may affect eligibility
We review all eligibility requirements with you to ensure there are no surprises after filing.
Why Not to Rely on Online Calculators
Online means test calculators can be misleading or incomplete. They often fail to account for allowable deductions such as medical expenses, irregular income, or household contributions. Our firm conducts a full financial review to determine whether Chapter 7 is feasible and advisable—often uncovering eligibility where clients thought none existed.
Our goal is simple: give you an honest, accurate answer and explain your options clearly.
Still Comparing Bankruptcy Options?
If Chapter 7 isn’t available, understanding alternatives is just as important.
Find Out If You Qualify—At No Cost
Wondering if you qualify for Chapter 7 bankruptcy in Ohio? Don’t guess at income limits or rely on outdated charts. Contact Vaughn & Associates for a free means test evaluation, and let us determine whether Chapter 7 can be your path to a fresh financial start.
