If the debtor's current monthly income is more than the state median, the Bankruptcy Code requires application of a means test to determine whether the chapter 7 filing is presumptively abusive. Abuse is presumed if the debtor's aggregate current monthly income over 5 years, net of certain statutorily allowed expenses, is more than (i) $12,850, or (ii) 25% of the debtor's nonpriority unsecured debt, as long as that amount is at least $7,700.

The debtor may rebut a presumption of abuse only by a showing of special circumstances that justify additional expenses or adjustments of current monthly income. Unless the debtor overcomes the presumption of abuse, the case will generally be converted to chapter 13 (with the debtor's consent) or will be dismissed.

In Arizona, as in other states, the means test is a requirement for debtors who wish to file for Chapter 7 bankruptcy and whose income is above the state median. The means test is designed to determine whether a debtor has enough disposable income to repay some of their debts. If a debtor's adjusted current monthly income over five years exceeds $12,850, or 25% of their nonpriority unsecured debt (provided that this amount is at least $7,700), the filing is considered presumptively abusive. Debtors have the opportunity to rebut this presumption by demonstrating special circumstances that warrant additional expenses or adjustments to income. If the presumption is not successfully rebutted, the bankruptcy case will likely be converted to a Chapter 13 bankruptcy, with the debtor's consent, or dismissed. This process ensures that Chapter 7 bankruptcy is reserved for those who truly cannot afford to pay their debts.