Motion to Dismiss and 100% Repayment

[Johnworker1]

I originally filed for Chapter 7 because wife lost job and I lost my overtime. I was current on all my bills up to the month or 2 before filing. I was denied Chapter 7 but my wife was granted Chapter 7 and had all her debt erased. I filed for Chapter 13 and got a payment plan that was almost the same amount (2200) I was paying before the BK. After about a year wife and I separated and the financial stress increased. Attorney suggested refile and we did but during the meeting who I later found out was the trustee's boss came in behind me unannounced and undetected but interrupted and scrutinized me with her questions. I was granted a 10% repayment @ $600 for 3 years but one of my secured creditors who didn't reclaim the secured property (boat) because it was worthless seemed mad I didn't want to keep (reaffirm?) it so he started contesting things dragging it out. When I volunteered to deliver the item he declined but my plan was extended another 12 months to 48 because of his objections/request.

I paid on the plan regularly but owed on my taxes for that year which they added to the plan then the next year after I received certified mail from the IRS stating I owed 6K. I tried to request a payment plan but it was blocked but later found out because it was added to my plan also. I paid more than my amount due because of added IRS bills and planned on paying it off early even though attorney discouraged that. The only other issue I had is I fell 2 months behind on mortgage after about a year and tried to modify it through an outside not for profit agency then the trustee's attorneys filed all kind of things which seem they were going to foreclose so I caught it up pretty quick and left modification alone even though house is underwater.

Well a few months before my final payment they sent out a tax return and refund request but I had not filed those taxes yet. Coincidently I paid my last payment in Apr and filed my current and previous year taxes. I called the trustee office to see if they needed anything and was told to just wait for the audit completion that would show if I owed anything else. My attorney said technically if its not closed to keep sending payments so I sent the next month payment but the month after that I called the trustee office again and they said I am paid up so don't pay anymore and wait for the completion of the audit. Well last week I received notice they were filing a motion to dismiss because I didn't not tender my tax returns forms/refunds to them. I thought they had the first 2 years returns since they added the tax due to my plan and I just filed the last 2 years so I emailed and faxed all 4 years to them. My attorney said she has never seen them file for the motion to dismiss that so late in the case which at that time was after my 49th final payment. She also said it was not good that my income increased each year but I explained to her that due to expired contract and labor issues we got awarded back pay and subsequent raises after 4 years of none and OT was started again. Well after that meeting I got a text from my attorney stating the trustee attorney requested 100% and the judge agreed. She then said what is the purpose of filing for BK if you are going to pay 100% (my question also) and then stated attorneys want to see the tax returns to insure you don't get refunds (which I didn't) not as basis to increase the plan payments. She said she has never seen this before and I wanted to ask does my case sound typical or something isn't right? I have thought about retaining another lawyer if mines is not doing her job or is this how the BK trustees operate.

[kingmartin06]

Why was you not able to file a chapter 7? Were you above the median income level?

[Johnworker1]

Yes I was above the median income level but that was never said to me the reason. Is that a good indicator?

[LadyInTheRed]

It is really hard to tell what is going on based on your description. Nothing about your description sounds typical, but I think that may come more from your lack of understanding of what has happened at all stages of the case.

The description of what happened with the creditor on the boat loan makes no sense. Either does the sudden appearance of the trustee's "boss."

Are you sure your income was above median on the date you filed your current Chap 13? If it was, you could not get a plan confirmed for less than 60 months unless it paid 100% of unsecured claims.

If your attorney doesn't understand why people would file a Chap 13 that pays 100%, I don't have much confidence in her. I think she is wrong that trustees only want tax returns to see if you have a refund. They also want to see if you have an increase in income. Increases in income should be reported to your attorney during a Chap 13 so your attorney can report the increase to the trustee if required by your plan and local procedures. How much did your income increase and how long ago?

It sounds like you filed both your 2014 and 2015 returns in April. Did you get an extension for the 2014 returns, or were they delinquent? Do you have more delinquent tax?

Was it at the hearing on your motion to dismiss that the judge agreed you should pay 100%? What was the judge's ruling? Did he dismiss the case, order a modification to the plan or something else? What does your attorney say is going to happen now?

[Johnworker1]

Yes I do have extreme misunderstanding. I wrote the original post during a late night rant so maybe I can provide some clarifications.
The person who sat in on my meeting wasn't there at the start nor did she introduce herself when she entered. I only discovered she was behind me when she interrupted with her questions. Now looking back maybe I should have asked her name and her position but I was so scared and startled I just kept answering questions. My attorney later said she was some sort of supervisor maybe not the trustee but she comes out for certain cases. I asked why mines because I thought I didn't have much but I never got a clear answer.
The attorney for the creditor for a practically worthless old boat did raise many motions ultimately raising my contributions and lengthening my payment from 36 to 48 months. My attorney point blank pointed in one meeting that he was getting pennies on the dollar for his objections. His response while not verbatim was something to the effect other creditors would benefit but he was the only one at this meeting. She thought he was just building billable hours I thought it was slightly more personal. She did state that they didn't like I had 2 boats (was trying to sell one) and a RV trailer but that trailer was less than the price of a cheap car.
I don't know what median income is but IIRC I was showing approx. 80K annual on my means test.
I found out it wasn't a 100% repayment they asked for at the hearing for the motion to dismiss. They dismissed my case so maybe that 100% she mentioned was what I owe now technically. She said she has only seen this happen once before but it was severe circumstances.
Yes I filed the 2014 and 2015 in April and no I didn't get an extension I paid penalties/interest one year the other I had a very small refund (less than $200) that later I was notified they kept for previous balance owed (which I never received correspondence for). As far as I know I don't have any more delinquent taxes but now that you ask I will verify with the IRS.
My understanding is the judge agreed with the trustee's attorney and dismissed the case. Was it for not sending tax returns or increase in income (or both) I am not clear. My attorney said this attorney no one likes and is unreasonable. Again she restated that the tax returns are to verify no refunds. She also says they always file those motions immediately upon not receiving a copy of refund she doesn't know why they waited until after I paid all payments. My layman opinion is that they gave me enough rope that they could hang me. She says my increase would have raised flags the first return anyway and they would have seeked a modification to my payments but I would have rather that than what happened to me now,

[Johnworker1]

Update: Attorney asked me to wait to see which creditors would contact me. She said some may fall off. So far got 3 calls from creditors asking for money from charged off accounts. Trying to shop for another attorney locally to get a 2nd opinion on what I should do next. My salary increased and I work more OT and wife reconciled so my financial picture has changed.