Legally reviewed by Allen A. Kolber, Esq. - The Law Offices of Allen A. Kolber, Esq., P.C.
Key Takeaways
- The means test uses the New York median, not a national or county figure.
- Earning above the median is not a bar; it triggers a second calculation.
- The median figures change about twice a year, so check them on your filing date.
- Business or farm debts may point to a different chapter.
Upon your initial research on consumer bankruptcy, you may have learned that there are two types: Chapter 7 and Chapter 13. After reading the pros and cons of each chapter, you may have one that you prefer over the other in your mind. Well, in this case, please follow along to find out whether you can choose the type of consumer bankruptcy to pursue and how a proficient Rockland County bankruptcy attorney at The Law Offices of Allen A. Kolber, Esq., P.C. can point you in the right direction.
Can I Choose Which Type of Consumer Bankruptcy to File?
In short, it is not necessarily a matter of choosing to file the consumer bankruptcy type you want, but rather selecting the one that works in your best interests given your unique financial situation. When consulting one of our attorneys, we may advise you to file for one over another. Without further ado, read the following to see whether you are more aligned with a Chapter 7 or Chapter 13 consumer bankruptcy filing:
- You should choose Chapter 7 bankruptcy if:
- You are currently unemployed or otherwise struggling with a steady stream of income.
- You have few assets to protect and far more debts you wish to rid yourself of.
- You require relief from your debts to better your financial standing sooner rather than later.
- You should choose Chapter 13 bankruptcy if:
- You have a stable, significant income and wish to use it to pay back your creditors slowly.
- You have many valuable assets you are unwilling to lose through the bankruptcy process.
- You have several codebtors whom you wish to protect from your personal bankruptcy petition.
Are Chapter 7 and Chapter 13 the Only Options?
For the majority of individuals seeking relief from personal debts, yes, Chapter 7 and Chapter 13 are typically the only options. However, a few other chapters do exist for more narrow circumstances.
Chapter 11 is a reorganization chapter used by businesses, though it is also available for individuals whose debts exceed the Chapter 13 ceilings. Within Chapter 11 sits Subchapter 5, which offers a more streamlined and less expensive route for small business debtors.
Chapter 12 is exclusively reserved for family farmers and fishers.
As such, if your debts are tied to a business you own rather than to household spending, the aforementioned chapters may not be right for you.
What Is the Means Test for a Chapter 7 Bankruptcy Filing?
Even if you find Chapter 7 bankruptcy to be more appealing, you must ensure that you are eligible before filing for it. That is, you must pass the Chapter 7 means test to demonstrate that your income is low enough to pursue this consumer bankruptcy type. Specifically, your current monthly income must be below the median income for a family of your size in New York State. The Department of Justice publishes these figures as annual amounts and revises them roughly twice a year, so the ones that govern your case are the ones in force on the day you file. For New York cases filed on or after July 15, 2026, the median family income figures are as follows:
- For a one-person household: $73,272 per year.
- For a two-person household: $92,902 per year.
- For a three-person household: $115,579 per year.
- For a four-person household: $139,040 per year, plus $11,100 for each additional household member.
In the event your income is above the median figure for your household size, you are not immediately disqualified from pursuing Chapter 7. Instead, you will need to complete the second half of the means test, which allows you to subtract certain living expenses, secured debt payments, and other amounts from your income to arrive at your disposable income. Only if what remains is high enough does the law presume that pursuing Chapter 7 would be an abuse, though that presumption may still be rebutted by special circumstances. When the presumption stands, Chapter 13 is generally the route forward to bankruptcy.
Contact an Experienced New York Bankruptcy Attorney Today
Before entering these proceedings, you should have already hired a talented Rockland County bankruptcy attorney with The Law Offices of Allen A. Kolber, Esq., P.C. to represent you. Our firm understands that bankruptcy can be overwhelming and difficult to navigate, which is why we can help you through this process to seek the best possible outcome. Contact us today to learn how we can represent you during these complex times.
