Does paying 100% in plan allow you to keep raises, etc.

[daylate]

I'm trying to analyze my son's situation and I think I have read here that if your 13 plan allows for a 100% payback then you can keep excess cash from raises, bonuses, etc. is this a correct reading? And as a follow-up question, lets say you have an 85-90% plan-how does that affect bonuses, etc?

[lrprn]

It depends on the trustee. If a plan is 100%, most won't care about extra added disposable income and will allow the plan to play out as confirmed.

However, if your son's case really is 100% payback, then he may work with his lawyer to amend his plan to give the extra disposable income to the trustee because that shortens a 100% plan. (Note to Members: Increasing the amount of your monthly payment does *NOT* shorten plans that have less than 100% payback.)

[daylate]

Thanks for the reply. I also did some googling and it seems that, as in many cases in bk, even if it is not 100% some (quite a few) districts and trustees aren't aa diligent about pursuing bonuses and increases as others.

[justbroke]

They key is that most Trustees are actually trying to put a human face on bankruptcy. They will not go after bonuses and salary increases unless they are substantial. The number that is thrown around quite a bit is 10%. That is, when the bonus or salary increase yields a net increase in your income greater than 10%, the Trustees want the money.

Otherwise, Chapter 13 debtors are not bothered so long as they stay on plan and stay current!

[cbmmom5]

I wanted to respond to the part where IPRN stated that bonuses could pay off a 100% plan early. I am not sure if the orginal poster is in the same situation as me or not but I was recently informed that extra paid into the plan from bonuses or tax refunds etc would not shorten my plan. For example, I turned over about $5,000 from my tax refund as required. I thought that would take off $5,000 from my base plan. My base amount was acutally increased by the same amount. My lawyer and the trustee explained that because of the $5,000, my unsecured creditors would get more. I am in a 100% payback, 60 month plan.

I found out also that I will need to stay in my chapter 13 regardless what extra is given to my trustee because my student loans far exceed the total amount I will pay.

[LadyInTheRed]

My lawyer and the trustee explained that because of the $5,000, my unsecured creditors would get more. I am in a 100% payback, 60 month plan.

When we say 100% plan, we mean that the plan provides that 100% of all approved unsecured claims will get paid. If your bonus increases the amount to unsecured creditors, you are not in a 100% plan.

[justbroke]

I agree. I didn't know about the phantom student loan debt in the "100%" plan. Student loans are unsecured, non-priority, and non-dischargeable. They actually need to be added to the "base plan" in order to have a true "100%" plan.