How Much Is Too Much to Make to File Bankruptcy? Income Limits Explained

How Much Is Too Much to Make to File Bankruptcy?

How much is too much to make to file bankruptcy is a question many people ask when they’re struggling with debt but still earning a steady income. It’s a common concern—and the answer isn’t always clear-cut. The truth is, there’s no absolute income cap that automatically disqualifies you from filing bankruptcy. But how much you make can impact which chapter you’re eligible for, how your case is reviewed, and what kind of relief you can get.

In this article, we’ll explain how income affects bankruptcy, what the means test is, and how to know if your income is “too high” for Chapter 7—but still workable in Chapter 13.

Is There an Income Limit for Bankruptcy?

Technically, no—there is no strict income limit that prevents someone from filing for bankruptcy. You can earn any amount and still file. However, your income will affect:

• What chapter you can file under (Chapter 7 vs. Chapter 13)
• Whether you’ll need to repay some of your debts
• How the court evaluates your financial hardship

So instead of a maximum income, the bankruptcy system uses a tool called the means test to determine eligibility for Chapter 7.

What Is the Means Test?

The means test compares your income to the median income for your state and household size. It’s designed to prevent high-income earners from discharging debts too easily when they may still be able to repay some of what they owe.

Step 1: Compare Your Income to the State Median

If your average monthly income (over the past 6 months) is below the state median, you automatically pass the test and can file Chapter 7.

If it’s above the median, you move on to Step 2.

Step 2: Subtract Expenses to See If You Qualify

You’ll subtract allowed expenses (housing, food, transportation, child support, etc.) to determine your disposable income.

If that number is low enough, you may still qualify for Chapter 7. If not, the court may require you to file Chapter 13 instead.

State Median Income Thresholds (Examples)

The median income varies based on household size and state, and it’s updated regularly. Here are a few sample monthly income limits (as of 2024, rounded):

• California (1 person): ~$6,600/month
• Texas (2 people): ~$6,400/month
• New York (3 people): ~$8,500/month
• Florida (4 people): ~$9,000/month

If you’re earning more than these amounts, the court may take a closer look at your case—but it doesn’t mean you’re disqualified.

What If You Make “Too Much” for Chapter 7?

If you fail the means test or the court finds that you have enough disposable income, you may not qualify for Chapter 7. But that doesn’t mean you’re out of options.

You can still file for Chapter 13, which allows you to:

• Catch up on mortgage or car payments
• Consolidate and repay a portion of your debts over 3–5 years
• Avoid lawsuits and stop collections

Chapter 13 is often a better fit for people with regular income who want to protect assets like their home or car, or who don’t qualify for Chapter 7 due to higher earnings.

Does High Income Always Block Bankruptcy?

Not necessarily. Even if your income is above average, bankruptcy might still be possible (and even necessary) if:

• You have high fixed expenses, like medical costs or childcare
• You’re supporting dependents or paying child/spousal support
• You recently lost a second job or had a drop in income
• You have non-dischargeable debts you want to restructure

The courts don’t just look at income in isolation—they evaluate your entire financial picture.

How Much Is “Too Much”? It Depends

So, how much is too much to make to file bankruptcy?

It depends on:

• Where you live
• How many people are in your household
• What type of debt you have
• What your necessary living expenses are
• Whether you’re filing Chapter 7 or Chapter 13

This is why bankruptcy law isn’t one-size-fits-all. You may earn $100,000 a year and still qualify—if your expenses are high and debt is overwhelming. Another person making $50,000 could be disqualified if their expenses are low and they have leftover income.

Income Isn’t Everything—Bankruptcy Is Still an Option for Many

How much is too much to make to file bankruptcy? The truth is—it depends. There’s no universal income limit that blocks you from filing. While higher income may prevent you from qualifying for Chapter 7, it doesn’t disqualify you entirely. With the help of the means test and an honest look at your financial situation, many people with substantial earnings still qualify for meaningful debt relief.

From large medical bills to rising living costs, even high earners may face financial hardship. The key is how your income compares to your expenses and debts—not just your paycheck. Whether you’re filing Chapter 7 or Chapter 13, what matters most is building a case that reflects your true financial picture.

Unsure If You Make Too Much to File Bankruptcy? Talk to an Expert Today

Still asking how much is too much to make to file bankruptcy? Legal Brand Marketing connects individuals with experienced bankruptcy attorneys who can walk you through the means test, evaluate your income, and explore Chapter 7 or Chapter 13 options. No matter your income level, personalized guidance is the best way to know your options.

Get clarity on your eligibility—speak to a bankruptcy attorney today and Contact us to take the next step toward financial relief.