Means Test

• When a debtor files for bankruptcy, she must take the means test. This test determines if she can file for Chapter 7 bankruptcy by comparing her family income to the median family income for a family of the same size in her state of residence.
  
  

Disposable Income

• The means test also figures out the debtor's monthly disposable income by deducting monthly expenses from monthly income. Monthly disposable income may determine if the debtor can file for Chapter 7 bankruptcy. The debtor's monthly disposable income also determines the length of the debtor's repayment plan in Chapter 13 bankruptcy.
  
  

Income

• The Bankruptcy Code classifies wages as part of the debtor's income but not the debtor's only source of income. Commissions, pension payments, Social Security benefits, disability, unemployment or workers' compensation benefits, alimony or child support, royalties and rents fall under the category of income for the purposes of bankruptcy.