Hey folks I have a few questions I'm hoping someone can shed some light on. Currently I have about 25k in CC debt, a property settlement with my 1st wife of about 65k on a home we owned togethor secured by a cosigned mortgage and 130k in debt on my current house and 25k on a car loan. My other car is 10 years old.
My current wife and I make about 90k per year gross and 6-8k in bonuses usually paid in March of each year. We are current on all the debt right now. We live in Oklahoma.
The home and car with the note are exempt or can be reaffirmed. We are trying to look at how to best time our ch13 filing. Here are my questions (and keep in mind we are not wanting to do anything illegal however just as tax avoidance is legal and tax evasion is not we view the BK code the same way):
1. We want to replace our 1999 alero with a new car. Ideally we would like to purchase in January/Feb of next year a honda civic GX. We would like to use our 2009 tax refund and our existing car as a trade in. That will add a net amount of about 18k to our total debt. This is too get us positioned for us to have reliable cars throughout our ch13 period. It also deals with the view of some trustee's that you can't claim the vehicle expense in the DI test unless you actually have the debt (dumb in my view but all that means is that a secured creditor gets more and unsecured creditors get less in the final analysis). If we wait until Jan to purchase and then pay down the debt in Feb with the tax refund and not file until May or June does that present issues?
2. 401K contributions: I've researched the site and it seems there is a large amount of opinion that you can or can't continue to put contributions that are matched by employers outside the bk estate (not the amounts already in the accounts but ongoing contributions is my question). My question is are there any definitive cases in district or appelate courts on this issue? I can buy a reasonableness arguement on either side and since the 05 changes in the BK law there should have been time for a case or two to reach the district court level.
3. Bonus. If our bonus is less than 25% of our wages in the last 6 months can't we exclude that from the BK estate? We need to have some work done on our home and want to pay that after a filing. What about subsequent years? Can bonuses be used to pay any large expenses that come up, like appliance replacement etc. The reason I ask is that reasonably you should set money aside in your budget to save up for these things however the posts I've seen here basically say the trustee's often don't permit that in the budgeting process for DI because it reduces the amount paid to unsecured creditors. Thoughts?
4. Raises and witholding: 2 issues but if we recieve a raise we need to tell our attorney and trustee and ask for direction on if our payment has changed right? On tax witholding if we change our witholding after the 13 starts we don't have to adjust our payments as this simply effects our refund which would be in most cases turned over to the trustee in any case anyway, right?
5. FSA/HSA contributions: What is considered reasonable? I have a 3 year old with some medical issues and the last few years we've seen out of pocket medical expenses in the range of 2k-6k not counting daycare. Can we increase these contributions in the 13 every year in our open enrollment period?
Any insight would be appreciated on then the timing of the filing knowing we would potentially buy the new car in Jan, apply a tax refund to that payment in Feb and recieve our pay and bonus increases in March. Does it mean to avoid any presumption of abuse we have to wait until the following August/September?
Thanks for your help.
My current wife and I make about 90k per year gross and 6-8k in bonuses usually paid in March of each year. We are current on all the debt right now. We live in Oklahoma.
The home and car with the note are exempt or can be reaffirmed. We are trying to look at how to best time our ch13 filing. Here are my questions (and keep in mind we are not wanting to do anything illegal however just as tax avoidance is legal and tax evasion is not we view the BK code the same way):
1. We want to replace our 1999 alero with a new car. Ideally we would like to purchase in January/Feb of next year a honda civic GX. We would like to use our 2009 tax refund and our existing car as a trade in. That will add a net amount of about 18k to our total debt. This is too get us positioned for us to have reliable cars throughout our ch13 period. It also deals with the view of some trustee's that you can't claim the vehicle expense in the DI test unless you actually have the debt (dumb in my view but all that means is that a secured creditor gets more and unsecured creditors get less in the final analysis). If we wait until Jan to purchase and then pay down the debt in Feb with the tax refund and not file until May or June does that present issues?
2. 401K contributions: I've researched the site and it seems there is a large amount of opinion that you can or can't continue to put contributions that are matched by employers outside the bk estate (not the amounts already in the accounts but ongoing contributions is my question). My question is are there any definitive cases in district or appelate courts on this issue? I can buy a reasonableness arguement on either side and since the 05 changes in the BK law there should have been time for a case or two to reach the district court level.
3. Bonus. If our bonus is less than 25% of our wages in the last 6 months can't we exclude that from the BK estate? We need to have some work done on our home and want to pay that after a filing. What about subsequent years? Can bonuses be used to pay any large expenses that come up, like appliance replacement etc. The reason I ask is that reasonably you should set money aside in your budget to save up for these things however the posts I've seen here basically say the trustee's often don't permit that in the budgeting process for DI because it reduces the amount paid to unsecured creditors. Thoughts?
4. Raises and witholding: 2 issues but if we recieve a raise we need to tell our attorney and trustee and ask for direction on if our payment has changed right? On tax witholding if we change our witholding after the 13 starts we don't have to adjust our payments as this simply effects our refund which would be in most cases turned over to the trustee in any case anyway, right?
5. FSA/HSA contributions: What is considered reasonable? I have a 3 year old with some medical issues and the last few years we've seen out of pocket medical expenses in the range of 2k-6k not counting daycare. Can we increase these contributions in the 13 every year in our open enrollment period?
Any insight would be appreciated on then the timing of the filing knowing we would potentially buy the new car in Jan, apply a tax refund to that payment in Feb and recieve our pay and bonus increases in March. Does it mean to avoid any presumption of abuse we have to wait until the following August/September?
Thanks for your help.
Comment