Should my wife even bother to seek employement once i file chapter 13?

[chp13]

Ok so we just filed chapter 13 soley based on my income. My wife is a homemaker. She has the opportunity to become employed for the county we reside in, a steady income of 2-3k a month. It sounds good but is there really any point of her even working while were in chapter 13? I mean, once I let the trustee know they'll probably take all of her income and apply it towards our debt right?

[CCB35]

if you are filing jointly and arent going to be paying a 100% ,they would add that income .All disposable income .

[despritfreya]

Now you understand the problem with the system. There is no incentive for those in a Chapter 13 to better themselves as you technically are working for the creditors. During the 13 you work as little as possible in order to pay as little as possible. However, once your Plan is Confirmed no one is watching "the hen house". Your income could go up. That information would be reported in your tax returns. The Trustee's office would necessarily see the increase but, unless your Order Confirming specifically requires you to file new I&J's each year, no one would be the wiser. The interesting thing is that Section 521(f)(4) gives the Court, the Trustee or any creditor the right to require a Chapter 13 debtor to file the amended I&J. This rarely happens. Also, if such an increase is discovered (someone actually looks at the information supplied), the Trustee or an unsecured creditor could seek to modify the Plan under Section 1329. Again, this rarely happens. So. . . if one is going to up their income, something more than a COL raise, one should do so AFTER the Plan is Confirmed and then hope that no one notices or one never has to submit a modification to that Plan.

Des.

[IamOld]

CHp13's is something I was also wondering about...Des your counsel is great as always. The thing is that I suppose since only my spouse is filing CH 13 that Trustee may want updated I & J from us each year to check on my income as spouse's income does not change (no raises there!!! NONE...ZERO ZIP)...alas aside from COLA's, it really won't change that much...we'll see!

Now you understand the problem with the system. There is no incentive for those in a Chapter 13 to better themselves as you technically are working for the creditors. During the 13 you work as little as possible in order to pay as little as possible. However, once your Plan is Confirmed no one is watching "the hen house". Your income could go up. That information would be reported in your tax returns. The Trustee's office would necessarily see the increase but, unless your Order Confirming specifically requires you to file new I&J's each year, no one would be the wiser. The interesting thing is that Section 521(f)(4) gives the Court, the Trustee or any creditor the right to require a Chapter 13 debtor to file the amended I&J. This rarely happens. Also, if such an increase is discovered (someone actually looks at the information supplied), the Trustee or an unsecured creditor could seek to modify the Plan under Section 1329. Again, this rarely happens. So. . . if one is going to up their income, something more than a COL raise, one should do so AFTER the Plan is Confirmed and then hope that no one notices or one never has to submit a modification to that Plan.

Des.

[cereber0s]

The Trustee's office would necessarily see the increase but, unless your Order Confirming specifically requires you to file new I&J's each year, no one would be the wiser.

How do you know if you are required to file a new I&J each year or not?

[chp13]

From reading the above reply, the confirmation order?

[Cristo]

Here is what it says in my order.......

ORDERED, that the Debtor(s) is/are directed to provide to the Trustee a copy of each
Federal income tax return, and any amendment, at the same time it is filed with the taxing
authority while the case is pending; and it is further
ORDERED, that the Debtor(s) is/are directed to provide to the Trustee annually not later
than 45 days before the anniversary date of this Order, a statement, under penalty of perjury, of
(i) the income and expenditures of the debtor during the tax year most recently concluded before
such anniversary date, and (ii) the monthly income of the debtor(s) that shows how income,
expenditures, and monthly income are calculated; and which discloses (a) the amount and
sources of the debtor(s)’ income, (b) the identity of any person responsible with the debtor(s) for
the support of any dependent, and (c) the identity of any person who contributed, and the amount
contributed, to the household in which debtor(s) resides.

However, as Des says, someone would have to actually look at the information provided. My lawyer told me that they do follow up on the taxes but not so much on the income/expenses part.

[Flamingo]

In a Chapter 13, everyone is advised that they are to report any increase in income, inheritances, lottery winnings, etc. A household increase of a $2,000 to $3,000 per month is nothing to sneeze at. Also, if she does not take this job now, would she have something comparable after your Plan is over? Is this a 5 year plan? You have a lot to think about here. If she should go to work after your plan is confirmed and you do not report any income she should make as it increases your household income, you risk Plan dismissal. Each year during our plan we had to provide copies of both our federal and state tax returns to the trustee within 5 days of filing. Someone once mentioned on here it is now required with the passage of the new BK law in 2005 but whether or not it is followed-through via each district is something someone should check with their attorney; but anytime during one's Chapter 13, the trustee can ask for any financial information to be provided - the trustee is in control of your financial house during that time. I would sit down and discuss your entire scenario with your attorney who knows your financial situation the best at this point.