What is the bankruptcy means test?

The bankruptcy means test determines whether you qualify to file Chapter 7 bankruptcy. It compares your average monthly income over the past 6 months to your state's median income. If you're below the median, you automatically qualify. If above, you must pass a second part examining disposable income.

How much debt do you need to file bankruptcy?

There is no minimum debt amount required to file bankruptcy. However, most bankruptcy attorneys recommend filing only when debt exceeds what you can realistically repay within 5 years, typically $10,000 or more.

How long does bankruptcy stay on your credit report?

Chapter 7 bankruptcy stays on your credit report for 10 years from the filing date. Chapter 13 bankruptcy stays for 7 years. Both affect your ability to get new credit, but the impact diminishes over time as you rebuild.

What states does this calculator support?

BankruptcyByState.net supports bankruptcy means test calculations for all 50 states using current federal and state-specific median income figures.

What is the homestead exemption in California?

California's homestead exemption protects $300,000 in home equity ($600,000 in high-cost areas). This applies to your primary residence in both Chapter 7 and Chapter 13 bankruptcy.

What is the vehicle exemption in California?

California's vehicle exemption protects $3,325.

Are retirement accounts protected in California bankruptcy?

Yes. All qualified retirement accounts (401(k), IRA, pension, 403(b)) are fully protected in California bankruptcy. This applies in both Chapter 7 and Chapter 13 and is guaranteed by federal law.

What is the wildcard exemption in California?

California's wildcard exemption is $1,550, which can be applied to any asset not otherwise covered by a specific exemption.

How are wages protected in California bankruptcy?

In California, 75% of disposable earnings. This protection applies to wages earned but not yet paid at the time of filing.

California Bankruptcy Exemption Calculator 2026

California's bankruptcy exemptions define which assets are protected from creditors and the bankruptcy trustee when you file. Understanding your exemptions is critical before filing Chapter 7, because the trustee can only liquidate assets that exceed exemption limits. In Chapter 13, exemptions still matter — they set the floor for how much creditors must receive in your repayment plan.

California's homestead exemption protects $300,000 in home equity ($600,000 in high-cost areas). Vehicle equity up to $3,325 is protected. All qualified retirement accounts (401k, IRA, pension) are fully protected in every state. California's wildcard exemption of $1,550 can be applied to any asset not covered by a specific exemption.

California 2026 Bankruptcy Exemption Limits

Asset Type	Protected Amount	Details
Homestead / Home Equity	$300,000	$600,000 in high-cost areas
Motor Vehicle	$3,325	Per vehicle; some states allow 1 vehicle only
Retirement Accounts	100%	401(k), IRA, pension, 403(b) fully protected
Wildcard	$1,550	Applies to any asset
Personal Property	$8,725	Household goods, furniture, clothing, electronics
Wages / Earnings	75% of disposable earnings	Applies to wages earned but not yet paid

California Chapter 7 Median Income (Reference)

To use the California exemptions in Chapter 7, you must also pass the means test. The 2026 income thresholds for California are: 1 person $74,676/year; 2 people $93,024/year; 3 people $104,784/year; 4 people $115,524/year.

Frequently Asked Questions

Does California allow filers to choose federal bankruptcy exemptions instead?

California is an "opt-in" state that allows filers to choose either state exemptions or federal bankruptcy exemptions. Consult an attorney to determine which set of exemptions protects more of your assets.

What happens to assets that exceed California's exemption limits?

In Chapter 7, if your equity in an asset exceeds California's exemption limit, the trustee may liquidate that asset, return the exempt amount to you, and distribute the remainder to creditors. You can sometimes avoid this by paying the non-exempt amount to the trustee (a "buyout") or by converting to Chapter 13. In Chapter 13, non-exempt asset equity affects the minimum payment to unsecured creditors but does not result in asset sales.

Are retirement accounts really fully protected in California bankruptcy?

Yes. ERISA-qualified retirement accounts (401k, 403b, pension, profit-sharing plans) are protected by federal law regardless of state. Traditional and Roth IRAs are protected up to $1,512,350 per debtor under federal bankruptcy law. Most states, including California, also protect state-specific retirement vehicles. This protection applies in both Chapter 7 and Chapter 13.