The plan need not pay unsecured claims in full as long it provides that the debtor will pay all projected "disposable income" over an "applicable commitment period," and as long as unsecured creditors receive at least as much under the plan as they would receive if the debtor's assets were liquidated under chapter 7. In chapter 13, "disposable income" is income (other than child support payments received by the debtor) less amounts reasonably necessary for the maintenance or support of the debtor or dependents and less charitable contributions up to 15% of the debtor's gross income.

If the debtor operates a business, the definition of disposable income excludes those amounts which are necessary for ordinary operating expenses. The "applicable commitment period" depends on the debtor's current monthly income.

The applicable commitment period must be three years if current monthly income is less than the state median for a family of the same size—and five years if the current monthly income is greater than a family of the same size. The plan may be less than the applicable commitment period (three or five years) only if unsecured debt is paid in full over a shorter period.

In Pennsylvania, as in other states, Chapter 13 bankruptcy allows debtors to keep their property and pay debts over time, usually three to five years. The law does not require full payment of unsecured claims as long as the repayment plan meets certain conditions. Specifically, the debtor must commit all projected 'disposable income' to the repayment plan over the 'applicable commitment period.' Disposable income is calculated as the debtor's income minus necessary expenses for maintenance or support and allowable charitable contributions. For business owners, disposable income does not include business operating expenses. The applicable commitment period is three years for debtors with a current monthly income below the state median for a comparable household size, and five years if their income is above the median. However, if the unsecured debt can be paid off in full in less than the applicable commitment period, the plan duration can be shortened.