The length of your payment plan will depend on your income. Under Bankruptcy Code Section 1325(b)(4), if your income is below your state’s median income level, your plan length (applicable commitment period) can be three years. If your income is above your state’s median income level, then your plan must be for five years.
However, you can complete your plan sooner if you pay in full all of your allowed unsecured claims.
Section 1325(b)(4) of the Bankruptcy Code states:
For purposes of this subsection, the “applicable commitment period”—
(A) subject to subparagraph (B), shall be—(i) 3 years; or(ii) not less than 5 years, if the current monthly income of the debtor and the debtor’s spouse combined, when multiplied by 12, is not less than—(I) in the case of a debtor in a household of 1 person, the median family income of the applicable State for 1 earner;(II) in the case of a debtor in a household of 2, 3, or 4 individuals, the highest median family income of the applicable State for a family of the same number or fewer individuals; or(III) in the case of a debtor in a household exceeding 4 individuals, the highest median family income of the applicable State for a family of 4 or fewer individuals, plus $625per month for each individual in excess of 4; and(B) may be less than 3 or 5 years, whichever is applicable under subparagraph (A), but only if the plan provides for payment in full of all allowed unsecured claims over a shorter period.