Should the spouse work?

[BCA2009]

I have filed for Chap 7 and think that it will work out ok. But I was wondering about something and haven't found the answer.

If you are forced into BK because a spouse loses a job, and you end up filing Chap 13, is there any reason for the spouse to go back to work after filing.

I guess what I'm asking is would the Trustee take all of the new income, or would you get to keep some of it?

If the Trustee takes all of the new income, I would perfer for my wife to stay home and be able to spend more time with our kids, rather than juggling daycare, summer care, and cooking and cleaning and then the trustee getting all of the money.

[optimistic1]

Well you can always beef up your expenses to a certain point, but if you would be basing your means test and schedules off of 1 income, and then after filing your spouse works and you make more, yes the trustee would take it, if he notices it.

[lrprn]

If you are forced into BK because a spouse loses a job, and you end up filing Chap 13, is there any reason for the spouse to go back to work after filing.

This is a "what if" question that doesn't have a real situation to go along with it. That makes answering it harder. However, given the limited information you've included, the original Ch 13 would be filed on just the one income. If the spouse goes back to work, then the Ch 13 plan would need to be amended because it's quite likely there will be additional disposable income from the new job.

I guess what I'm asking is would the Trustee take all of the new income, or would you get to keep some of it?

Completely depends on how the added income impacts the Means Test and Schedules when the plan is amended and how much extra (if any) disposable income shows up.

Since you've successfully filed Ch 7, it's unlikely you could be pushed into a 13...unless there are circumstances you haven't shared with us.

[BCA2009]

Right now I think we are ok on the Chap 7, even though we are 22K over the median.

This question was just more of a curiosity I was thinking about. If a Chap 13 plan was set based on one income, what is the incentive of trying to get more household income. It seems like you would be working harder and the Trustee would take all of the additional funds.

Maybe you might feel like you are "obligated" to try to contribute as much as possible to the plan, but in my hypothetical, I'm ignoring that factor.

I'm just thinking that if you are going to be locked into a plan for 5 years, I would rather my spouse not work so our home life would be less stressful.

[forgotten]

If a Chap 13 plan was set based on one income, what is the incentive of trying to get more household income.

Not much... I had a chance to take a position making about 20% more income, but it would have been more work. I obviously turned it down as it would have just been more to the plan payment and no extra for me.

There is little incentive to make more money once you have enough disposable income to submit a feasible plan.

[NoTomatoCan]

I guess one flip side to that argument is that after the 5 (or 3) years are done, you will be in a better place with your salary. And since things like annual raises (if they even exist any more) continue to build, you will ultimately be making more per year once you get out of BK.

But, if it is considerably more work like forgotten mentioned, then maybe it isn't worth it.

But I agree with everyone else... HUGE disincentive to work hard and earn more unless you are in a 100% plan (or close to it).

[forgotten]

One thing, that may be unique to my district...

If you get a second job, or work additional overtime(beyond what you were working prior and were included in your plan) you can keep the additional money.

My trustee's theroy is that you never would have worked harder to get that extra money if they were going to take it, so it wouldn't exist anyway if they opted to take it.

That doesn't count for raises on your standard work week on your primary job unfortionatly, but they also ignore anything under about 10%.

[optimistic1]

One thing, that may be unique to my district...

If you get a second job, or work additional overtime(beyond what you were working prior and were included in your plan) you can keep the additional money.

My trustee's theroy is that you never would have worked harder to get that extra money if they were going to take it, so it wouldn't exist anyway if they opted to take it.

That doesn't count for raises on your standard work week on your primary job unfortionatly, but they also ignore anything under about 10%.

Again the phrase comes to mind, having your cake and eating it too. I cant believe they would allow that, your getting debt discharged, but you could have paid it all along with the second job. So why not take it? I dont understand their logic on that one.

[forgotten]

Again the phrase comes to mind, having your cake and eating it too. I cant believe they would allow that, your getting debt discharged, but you could have paid it all along with the second job. So why not take it? I dont understand their logic on that one.

If I could have paid it off by taking a second part time job, I would have.

I'm not sure I would call having 2 incomes and commiting all your disposible income in to the plan then getting a second part time job that brings in a little extra money and being able to keep it having your cake and eating it too.

No one would ever take on a second job and work nights to be able to pay a little extra in to the plan.

Honestly, I can see it either way. I can see it being abused, like you said, where someone could have taken a second job and paid off their debt but instead filed BK then took the second job for the sole purpose of not having to pay as much back. I would never have entered BK unless there were no other options, but some people make take it more lightly.

Either way, I have it in writing from the trustee that I am only required to report, "money from a lawsuit, sale of property, inheritance, or lottery winnings. Overtime or income from a second job obtained after confirmation does not need to be reported."

[optimistic1]

Lucky you, I am not sure as to what my trustee will have in writing, being that I havent filed yet. Hopefully it will be the same. Several attorneys told me they would be surprised if the trustee's office even looks at your tax return each year, especially now with the increased influx of bk's.

[forgotten]

Lucky you, I am not sure as to what my trustee will have in writing, being that I havent filed yet. Hopefully it will be the same. Several attorneys told me they would be surprised if the trustee's office even looks at your tax return each year, especially now with the increased influx of bk's.

I was told the same thing. The trustee has no time to review the tax returns, they just get thrown in a box and filed away. Said the new law required you to mail them in, nothing about them actually having to look at them.

My attorney was clearly friends with the trustee (at the 341 they made quick mention about what time to meet on friday for drinks) so I assume it comes from inside information.

[optimistic1]

When do your payments start, time of filing or upon confirmation?

[woeisme]

When do your payments start, time of filing or upon confirmation?

1st payment due 30 days from the date you file. I've read of a few districts that require you to bring the payment to the 341, but my 341 was months after I filed, so I would have probably been dismissed if I had done that, since I'd already be 2 months behind on payments.

[pcn]

We've filed ch7, over the median. If something should happen and this not go through, my wife will quit her 2 part time jobs and stay home with the kids 100% of the time. We will get through the next 6 months somehow and then file a ch13. There is absolutely no way she will sacrifice time with our kids to fund a ch13. Maybe we are terrible people to think that way, but food, shelter, and family come before 30% interest sharks.