What Georgians Need to Know About Updated Chapter 7 Income Limits

If you are a distressed debtor in Georgia, a recent change in the law may have a positive effect on your eligibility for Chapter 7 bankruptcy protection. Debtors must satisfy a means test, which compares their monthly income to Georgia’s median and looks at their allowed expenses. A debtor who is found to have enough disposable income to repay creditors, at least in part may not qualify for Chapter 7 relief.

However, Georgia’s 2026 updated median income numbers may allow more people to qualify. For Chapter 7 cases filed on or after April 1, 2026, the median income levels are $68,478 for a one-person household, $84,965 for a two-person household, $101,479 for a three-person household and $123,481 for a four-person household. These figures are the starting point for determining whether someone can qualify for Chapter 7 under the means test. If your household income falls below the applicable median, you generally satisfy the first step of the test.

Debtors with income above the median income amount for their household size are not automatically disqualified from Chapter 7. There is a second step to the means test that considers allowable living expenses and certain other financial obligations, such as court-ordered spousal support, to determine whether you have the disposable income to repay your creditors. Many people who fall short of the first part of the means test may nevertheless be qualified to proceed.

Another common misunderstanding is that the means test looks only at your current paycheck. In reality, it looks at your average monthly income during the six calendar months before you file, along with your household size and other financial information. That means timing can sometimes make a difference. Someone whose higher income has recently declined due to a layoff or retirement, for example, may qualify for Chapter 7 protection just by waiting a few months.

Filing a Chapter 7 petition also triggers one of bankruptcy’s most important protections: the automatic stay. As soon as the case is filed, most collection activity must stop. Lawsuits, wage garnishments, most repossessions and many foreclosures must be put on hold while the bankruptcy case proceeds. While there are exceptions, the automatic stay broadly provides immediate emotional relief for people who have been the target of aggressive debt collectors. 

Determining whether you are a good candidate for Chapter 7 is more complicated than just finding your income on a chart. Your household size, allowable expenses and even the timing of your filing can all affect the outcome. You should carefully review your financial situation under the new median income.

Jeff Field & Associates, with offices in Douglasville, Gainesville, Bogart, Lawrenceville, Marietta and Decatur, can help take the fear out of the bankruptcy process and other debt relief options. Contact us online or call 404-381-1278 for a free initial consultation.