Attorney surprised us

[BrianBlade]

Hi, this is Citygirl's boyfriend again and I went with her to the attorney today because now that I know, I guess she wants to include me in her grief! ( haha )
Anyway, I was shocked at some of the things he said. He told us that he'd been working with the same trustees for years and that she only had to bring with her 2 weeks of paystubs ( not 6 months ) and 3 years of tax forms but NO bank statements. He just said to tell him what's in the account and he'll mark it down.
He then said that based on what she owes in unsecured which is about $65K ( included in that are her federal and state taxes which will be unsecured because they are 4 years old ) and her car payment which is currently about $650, she'll pay $855 into the plan. He said when she goes to court, the plan will be confirmed on the spot. The only way things will change is if less creditors file claims in which she will then have a shorter pay off time ( same payment )
If a creditor files an amount that is off the wall, then he said he'd deal with it but her case is cut and dry I guess because she has no assets. This is totally different then what we've been reading here about Chapter 13.

She is so happy and upset that she couldn't come here and post this so she asked me to do it. She is on the phone and says hello to everyone!


Brian

[CindyLou]

That's great news! So when will she actually file?

[BrianBlade]

On September 23rd. She is getting a huge commission on the 21st and if she files prior, all that money goes to the creditors, because it is money she knew she earned but hadn't gotten paid on, which is fraud if she doesn't report it, so the crafty atty is going to make it look like a one time bonus and he said he knows how to handle it with the trustee and judge.

[leftyf]

Good catch on the attorney...it is amazing how some can solve everything and others are just pains in the butt. I have 2 friends who both had DUI's...one paid $5K and walked away with a slap on the hand...the other did jail time, probation, no driving for 1 year, and a stint in rehab...he paid about $1.5K. They had the same judge and had committed the same crime, a 1st time DUI. Makes me a little ill to think about it, but there are "relationships" out there so keep that in mind. The attorney I plan to retain seemed offended when I asked if the trustee was easy to deal with or not...he said he is fine as long as we comply with the law. I'm taking that as a sign that he is in good with the trustee...wish me luck.
Lefty

[Minnymouth]

Brian,
Send our best to City Girl and let her know that I'm glad her Chapter 13 will be confirmed soon...

Sounds as though she found an excellent attorney to help her out and guide her.....

Its great that you support her in the decisions that she has to make....

Keep us posted....

[newbie2]

On September 23rd. She is getting a huge commission on the 21st and if she files prior, all that money goes to the creditors, because it is money she knew she earned but hadn't gotten paid on, which is fraud if she doesn't report it, so the crafty atty is going to make it look like a one time bonus and he said he knows how to handle it with the trustee and judge.

I suppose as long as trustees and other attorneys never read these boards she will probably be alright.

Frankly, I thought the bankruptcy laws were supposed to be equal in their application and enforcement, with some variance in "Local" customs.

It's a bit upsetting to most of us who turn in our income tax filings every year to the trustee, who pay more when income increases, and who struggle month to month to make ends meet to find out that others have "crafty" attorneys that are friendly with the trustees and don't have to struggle.

[Minnymouth]

Sometimes there are advantages to having "good attorneys", they know the in's & out's and what they can slip by or what the Trustee will allow within reason......

Wish my attorney had "took the time" to work in "my best interest" instead of his own....... I wouldn't have lost my home...

Consider yourself lucky.......

[JRScott]

Tell her we wish her the best

Sounds like she's got a good lawyer

[SinkingFast]

I suppose as long as trustees and other attorneys never read these boards she will probably be alright.

Frankly, I thought the bankruptcy laws were supposed to be equal in their application and enforcement, with some variance in "Local" customs.

It's a bit upsetting to most of us who turn in our income tax filings every year to the trustee, who pay more when income increases, and who struggle month to month to make ends meet to find out that others have "crafty" attorneys that are friendly with the trustees and don't have to struggle.

I'm having a bit of problem with this attny's approach too.

We've had several posters who've delayed filing because of a 1 time "Bonus". They don't typically get Bonuses on a routine basis. And out of the blue, their employer pays them a Bonus. Then the Filer has to wait for the Bonus to fall out the 6 month CMI period.

While this is a bit different in that it's earnings for work previously performed and not yet paid,........... It's still gonna have the same effect as a Bonus would on the 6 month CMI. A one time bump in pay that's once it's doubled could significantly increase the Filer's $$$'s/year income level. AND, as a result,....... The monthly Plan payment amount.

I'd be interested in the exact details of why filing 2 days after receiving this payment is more desireable than filing before the payment is received. Or waiting longer for that payment to drop out of the equation, for that matter.

[biotechsolution]

I have to agree with you sinkingfast.

The only way the that the bonus payment wouldn't be considered in the income for payback would be if the trustee isn't doing his job properly. It's income received in that 6 month period and if it's a bonus who's to say it won't happen again next year. I would think that they would want something from the employer stating that otherwise it would be considered future income.

I just hope that the UST doesn't want to audit her bankruptcy.

[BrianBlade]

Thank you Minny, I sure will! She says hello and apologizes for any hassle caused.
She is grateful for everyone here, I know that!

Brian,
Send our best to City Girl and let her know that I'm glad her Chapter 13 will be confirmed soon...

Sounds as though she found an excellent attorney to help her out and guide her.....

Its great that you support her in the decisions that she has to make....

Keep us posted....

[BrianBlade]

Thank you, yes she does. The cool thing about him too is that he won't do anything unethical, which is why he is telling her to file AFTER her big commission and not before.
He said he knows how to handle it and he knows the history of the trustee. He said he's been the trustee for over 2 decades or something. He never requests tax returns because he'd never ever have time. This is New York and there are way too many people filing for him to worry about tax returns. That's the good thing about living in a huge State! You pay high taxes but never get audited because it's too big!

Tell her we wish her the best

Sounds like she's got a good lawyer

[BrianBlade]

She can't wait 6 months for one thing. For another, he said if she files before, it's fraud because she knew she was getting it and already earned it but had not gotten paid yet. We asked how the trustee would know about it and her atty said, it's purjery if you don't tell him.
He said he'll figure it in to average out over 6 months. She makes 60K/year and it's $4500. He said not to worry, he will handle it ethically. She trusts him. The thing is, she can make that commission at any time. She's had a slow 4 months or so but it's not a bonus, it's her income. She makes 30K base plus commissions. One sale will put her over anyway so there really isn't any good time to file. She could get another one next week or next month or EVERY month for that matter. The trustee only wants the last 2 months of paystubs anyway, not 6 like many in this forum.

I'm having a bit of problem with this attny's approach too.

We've had several posters who've delayed filing because of a 1 time "Bonus". They don't typically get Bonuses on a routine basis. And out of the blue, their employer pays them a Bonus. Then the Filer has to wait for the Bonus to fall out the 6 month CMI period.

While this is a bit different in that it's earnings for work previously performed and not yet paid,........... It's still gonna have the same effect as a Bonus would on the 6 month CMI. A one time bump in pay that's once it's doubled could significantly increase the Filer's $$$'s/year income level. AND, as a result,....... The monthly Plan payment amount.

I'd be interested in the exact details of why filing 2 days after receiving this payment is more desireable than filing before the payment is received. Or waiting longer for that payment to drop out of the equation, for that matter.

[BrianBlade]

See above! it's not a BONUS!

I have to agree with you sinkingfast.

The only way the that the bonus payment wouldn't be considered in the income for payback would be if the trustee isn't doing his job properly. It's income received in that 6 month period and if it's a bonus who's to say it won't happen again next year. I would think that they would want something from the employer stating that otherwise it would be considered future income.

I just hope that the UST doesn't want to audit her bankruptcy.

[SinkingFast]

Thank you, yes she does. The cool thing about him too is that he won't do anything unethical, which is why he is telling her to file AFTER her big commission and not before.
He said he knows how to handle it and he knows the history of the trustee. He said he's been the trustee for over 2 decades or something. He never requests tax returns because he'd never ever have time. This is New York and there are way too many people filing for him to worry about tax returns. That's the good thing about living in a huge State! You pay high taxes but never get audited because it's too big!

We're not saying the attny might be planning to do is any thing unethical. A lot depends on the State's Exemptions. But drawing the Pay prior to filing is gonna boost the CMI for determination of the Plan payment. Plus, there's gonna be a lump sum payment that may need to be spent within a short period of time to get the cash on hand into your Court's acceptable level.

And the Trustee can't not require 2 years of income taxes. It's the Law. At the time of filing, the Debtor/Filer has to submit the most current 2 years of filed Income Tax returns. Even if the Trustee never looks at the taxes, the attny for the Filer still has to submit them. That's part of the New Law. And what ever copies the Local Trustee gets,.......... The UST's Office is gonna get the same thing.

What the Trustee chooses to look at post Confirmation is a whole different story. Some Trustees are like that. Once you're Confirmed, they don't wanna hear from you again, as long as the Payments come in like clockwork. But you've got to get to Confirmation. That's probably what the attny was referring to when he/she said the Trustee doesn't look at taxes. The attny meant down the road, after Confirmation.