Does Sched I & J provide for 401K contributions

[klandsb]

I am thinking my attorney dropped the ball on this ...Well along with a few other things ... I was looking at the stack of paperwork I just received from the attorney. These are my questions:

1) Obviously in Chapter 13 cases where the client is over median the means test is useless and ony determines if you have disposable income and doesnt make a bit of difference in your pmt amt ?????????

2) Schedule I & J does not have a place for 401 k contributions which I thought were allowed. I also have loan pmts that were left off of all my paperwork completly because my attorney advised it was either contributions or loans but not both. Should mine have been added into it in the payroll deduction other category ??? Is it possible to submit an amended schedule I & J if neccesary ??

3) Why are they so quick to do a wage attachment before your plan is confirmed seeing as it may change before then ?? I mean seriously if I didnt send the pmts I would put my case in jeopardy ???

I am getting a little more knowledge everyday about all this bk stuff and probally should have research alot better before hand but the creditors were at my doorstep and I jumped in headfirst

[lrprn]

1) Obviously in Chapter 13 cases where the client is over median the means test is useless and ony determines if you have disposable income and doesnt make a bit of difference in your pmt amt ?????????

Not true. The amount of your Ch 13 payment depends on a complex interaction calculation of gross income vs. secured asset payments for what the filer wishes to keep after filing, the filer's state exemptions, and the determination of acceptable living expenses. Each of these can vary widely between everyone that files Ch 13, even if they all have the exact same income over the median.

2) Schedule I & J does not have a place for 401 k contributions which I thought were allowed. I also have loan pmts that were left off of all my paperwork completly because my attorney advised it was either contributions or loans but not both. Should mine have been added into it in the payroll deduction other category ??? Is it possible to submit an amended schedule I & J if neccesary ??

Repaying 401K loans is a gray area in Ch 13 (although most case law so far across the country allows it).

You'll have to depend on your lawyer's knowledge of how your trustee typically reacts when a filer wants to maintain 401K contributions *and* wants to pay back 401K loans already made during the plan. If your plan is paying back unsecured creditors at less than 100% (the norm), then some Ch 13 trustees view paying back 401K loans as paying yourself back at the expense of your unsecured creditors. You need to find out from your lawyer how your local bk judge has ruled when there has been disagreement about this before in your local court and in your bk district.

3) Why are they so quick to do a wage attachment before your plan is confirmed seeing as it may change before then ?? I mean seriously if I didnt send the pmts I would put my case in jeopardy ???

Because typically your Ch 13 lawyer is being paid the remainder of his/her retainer fee through the plan, and also when the trustee needs to make secured asset payments for you, those payments can't wait until confirmation (or even later if there are objections). That's why the bk law specifically states the first Ch 13 payment has to made within 30 days of filing. What the trustee then does with that payment and others every month and to who disbursements are made and when is not your concern any longer. Your only jobs after filing is to make the payments on time, and to notify your lawyer if something unexpected happens that jeopardizes continuing with your plan, period.

[klandsb]

Irprn... I have looked at these papers so long my eyes went crossed .. Just seems like the amount she (the trustee) came up with has nothing to do with my DMI from the B22 form plus secured vs Schedule I & J ... there are different expenses that are on one but are not on the other. I saw a thread attachment from MSbklawyer stating all about this new 2005 bk law and how consumers are getting nailed because of the differences in these 2 forms.
Oh well, everyone wants my money , guess I will go pick from that money tree in my backyard to make my pmts ..... Its just so damn frustrating. First ripped off by debt settlement company now the trustee ...

[justbroke]

lrprn has done a very good job answering your initial questions, so I'm not even going to add anything to it.

Just seems like the amount she (the trustee) came up with has nothing to do with my DMI from the B22 form plus secured vs Schedule I & J ... there are different expenses that are on one but are not on the other

You would need to understand whether your District uses B22C or Schedule I/J to determine disposable monthly income. Also, if your Distict/Trustee uses B22C only, the expenses are different on purpose! Some like to use Schedule I/J because they are usually "actual" where B22C use mostly the IRS standards. Many Trustees will also use a combination of the B22C and I/J to balance out what are your actual payments. In any case, this does lead to confusion.

My District (apparently) uses the DMI on form B22C as your "unsecured" payment. They also use the line on 51 (debt service payment), as your base payment. So they add line 51 (debt service) with line line 59 (DMI) to reach the payment.

[klandsb]

It appears to me that the schedule I & J was they only thing they used to determine my pmts. ....

Thanks Justbroke

[justbroke]

It appears to me that the schedule I & J was they only thing they used to determine my pmts. ....

That's why I hate Districts that use Schedules I/J for over-the-median income filers. Personally, I don't think it's fair.

[klandsb]

UMMMM at this point me either ... Do u happan to know if u can include 401 k loans or contributions in the other part on wage deductions ??? I dont see any place for 401k anything on sched I & J and I want to ask my attorney Tues when I meet with him

[justbroke]

UMMMM at this point me either ... Do u happan to know if u can include 401 k loans or contributions in the other part on wage deductions ??? I dont see any place for 401k anything on sched I & J and I want to ask my attorney Tues when I meet with him

Yes, ask your attorney. In some Districts, you can't have both a contribution and a loan repayment. These Districts opine that a 401(k) loan payment and a 401(k) contribution are both "contributions" by definition. They only allow one contribution to be made during the Chapter 13. I tend to agree with them on that. So, you may only see one of the two included as a deduction from your income (Schedule I).

The loan repayment (or contribution) should go on Schedule I on line 4(d), OTHER PAYROLL DEDUCTIONS.

(Attention lurkers: the 401(k) deduction on Schedule I is for Chapter 13s only. Most Chapter 7 Trustees don't allow contributions or loan repayments on the Means Test or on Schedule I)