The median income test is a bankruptcy rule that states that if a debtor's median family income is at or below the state's median family income for a family the same size as the debtor's family, the debtor can receive Chapter 7 relief.

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The statement is true. The median income test determines whether a debtor qualifies for Chapter 7 bankruptcy by comparing their median family income with the state's median family income for a family the same size. If the debtor's income is at or below the state's median income, they are eligible for Chapter 7 relief.

The Median Income Test Is a Bankruptcy Rule That States