Local Standards/National Standards - vs. Schedule J

[wolfkingen]

Hello all. I've been browsing the forum for awhile and have now registered. I know someone out here will know the correct answer to my question!

I've been working with a lawyer and am very close to doing the filing. However, I've been dealing primarily with the paralegal and the lawyer. She is worried that since I'm only going to be paying back 11% of my debts that the trustee's will decline my plan. So she has lowered some of my expenses on Schedule J to below the limits stated on B22C.

Here is my question. All of these amounts were at the National/Local Standard:
Food - $285
Clothing: $86
Transportation: $187
Medical & Dental Expenses: $60
Laundry: $30
Misc. Expenses: $87
Personal Care Products: $31

Will/can the Trustees question these amounts or should I go ahead and let her lower them.

[UpsideDownMI]

Welcome to the board! First off, the trustee does not the power to decline a plan, they only have the power to object to a plan. Although if the trustee does not object, you should have smooth sailing to confirmation.

Some issues related to a chapter 13 plan payback are district specific. I can tell you that my plan pays less than 10% and my trustee did not take issue with my proposed % at my 341 hearing. If your expenses are within federal guidelines I would think you should be OK. My trustee did not question any of my expenses at my hearing.

You definately do not want to cut yourself short on legitimate expenses, as you are the one who will have to live with your plan for the next 3 - 5 years. In my opinion cutting your expenses to a level that you are not comfortable with, greatly reduces your chances for successful plan completion.

I you are not comfortable with this, you should firmly express this with your lawyer. Remember, your lawyer WORKS for you.

[wolfkingen]

Thank you for the welcome and the quick response.

I have found this site to be very helpful as I navigate this path. I am hoping this will go as smoothly as some of the others have reported!

[liz417]

Hi and welcome to this forum

First of all, how many are in your household (with those kind of numbers, it looks like it's just you)? Do you have an asset that you are trying to keep (house, cars, etc.)? Are you above the median? I was over the medain income and what put me over (ch 7) was that some of my expenses exceeded the local/IRS standard expenses, you've just got to be able to prove the expense if you are going to use it. If the amounts that the Paralegal is going to put in your petition is too low, then you really do need to speak up NOW, don't let them (attorney's office) write a plan that is going to ultimately fail!

[LimpDisc]

I had NO idea what my actual expenses were until I shredded my CC's and started paying cash for everything. Don't cut yourself short on expenses.

[wolfkingen]

Just me for the household. I do have a roommate which has affected my reported income. But looking at my gross income and the current income standards I am approx. $500/yr over the MN median standards.


No property that I'm trying to protect. I am walking away from my condo and have just recently purchased a new vehicle that will make it through the next 5 years.

I don't necessarily think I'm over the standard levels and have been paying cash for everything for quite some time now. This has been a long time in coming, I was actually trying to wait out the median income standards hoping they would increase since I was so close to the median. However a garnishment pushed the issue and with the median decreasing I have no choice but to file 13.

Did you have to provide receipts showing how much you spent for each category? I've just been estimating and going by the national standards.

[liz417]

Wow, you are only 500/month over and they want to push you into a ch 13?!? I was $21k over the median and qualified for a ch 7, I did have to consult with over 6 attorneys to find one that just didn't look at my income and automatically put me into a ch 13! Yes, I saved every receipt for a year I was concerned because I put $750 for transportation (not including car payment(s), have long commute). I've always used Quicken, so I know EXACTLY how much I spend in each catagory, which helped a lot.

[wolfkingen]

Yes, the monthly median for MN (current) is $3,966 and mine is $4000. So $34/mo over.

I was talking to the paralegal who was preparing the paperwork and indicated my concern about dropping the values. My estimated monthly payments with the drop is $315 and 11% repayment.

I use Mint.com so I do know the general categories, but as I'm not so sure if that purchase from Target included groceries, clothing, etc.

[DeadManCrawling]

I bet you could do a Ch 7.

Lawyers make far more money in a CH 13. Some lawyers, unfortunately, steer people who should be in Ch 7 to a 13 for that reason.

I would rethink this lawyer, or at least contact a couple others.

[wolfkingen]

It may be possible, but I don't see how I could qualify for the 7. I've been playing with the means test calculator and I don't seem to be able to get my numbers low enough. I have a roommate and her $400/mo portion of the rent is affecting my numbers.