Casino Gaming Wins/Losses- How Counted in BK (13 is the Way I am Going)

[jr001]

Hi,

I just met with a BK Attorney for the free consult here in NV. The main focus for filing is to do a cram down on a rental property and pay it over 5 years, it is feasible to do and about $28k in cc, unsecured debt. We would be looking at a BK 13.

After focusing on discussing our previous 6 month income and what % may go to pay cc, the unsecured debts. He used my handwritten spreadsheet I created of just income from our paychecks. Outcome of meeting, he advised we wait 2 or 3 months and bring our income down, as I had been working alot of O.T. I can stop that. Husband could retire, gets social security.

I left with some questions answered, yet my nature is analytical so of course I thought of what the unanswered ones were while driving home. I only had a small amount of time and had to focus on the most important to discuss. I thought about casino gaming. If we have a win, how does that equate into our 6 month income. For example, if I win $2000. that is a taxable. I would need to show ID to get paid and it would be reported on tax returns. Yet, on tax returns you take your wins and over the course of the year you can declare your loses. So, if that is the case, how does it work in reporting it for your 6 month income in the BK filing? Say, I win $2000. total taxable over 6 months, but my losses show $2400 over 6 months. Do I add the $2000. to our 6 months income or the loss wipes it out?

Anyone with info....thanks. Anyone that filed and reported win loss in your 6 months income averaging how did you do it? We always had budgeted a monthly amount for luck. Because we are going into BK now. Do we need to stop that? I am afraid to win a taxable and it will cause us to increase our income rather than reduce it over the next 2-3 months, as the Attorney advised. Yet, we have to pay our title loan off, about $2200 in a month and other bills and at least some of the Attorney fees. Also, it would be good to get a small cushion aside for the BK time line of the payment plan, once we are locked in, I don't want to miss a payment and things come up, like car repairs, home repairs, loss of hours at work and life changes!!!

[rpg1977]

I don't think anyone in a 13 is allowed to budget casino gaming, lol. Does your lawyer know about this item in your budget...surely it will be shot down in an instant.

[jr001]

How about people who go to play bingo at church? Hobby? or not allowed?

[LadyInTheRed]

Call the attorney and ask about the 6-month look back question. I bet a Las Vegas attorney will know the answer.

In a Chap 13, you are allowed to budget for recreation and entertainment. Your gambling could come out of that. But I would be shocked if you were allowed a $400 entertainment budget ($2400 in losses over 6 months). And that is how you should view gambing - as entertainment, not a source of income. Once you lose your budgeted entertainment amount, stop gambling. The same thing with church bingo. If somebody wants to give money to their church, they can include tithing in their budget.

[sore looser]

I can not imagine them allowing $400 budget for gambling...your going to be lucky to buy food let alone gamble. If you have taxable winnings they will take them to pay your debit..

[HHM]

If you are talking about the means test, it is handled like anything else...winnings are income...losses are expense.

However, on schedule J, there is no line item for gambling...it is a pure luxury. As pointed out, you can get some budget for recreation, but $400 is definitely pushing it.

[jr001]

Thanks for the input from all. I don't budget $400 a month in gaming or plan to after we file for BK 13. It seems that everyone in the posts finds a way to take money asigned in a budget for one use and use it for something else, savings, entertainment, vacation, or maybe alcohol or cigarettes. Maybe they have budgeted $100 for haircuts which they do not get, as I read, and they instead save for upcoming needs.

I should clarify. i did not spend much at the time of gaming and won $2000. within the last 6 months. So, I was wondering if I need to count that in the 6 month income. OR was this answered in the posts, that it would be income and I couid subtract the expenses? (Not sure how much loss over the 6 months, I would need to get a print out from the casinos) I just gave a hypothetical amount of loss to ask the question. Maybe by the time I file that month will drop off.

[HHM]

Yes, if you have winnings in the 6 months prior BK, it counts as income for the means test.

[karm43]

Wow I don't think you could cram down a house. Its not a refinance loan, its for people who are struggling or who have made very bad decisions. Most people want a little extra just so they could save for emergency, only thing not really extra.

[LadyInTheRed]

Wow I don't think you could cram down a house. Its not a refinance loan, its for people who are struggling or who have made very bad decisions. Most people want a little extra just so they could save for emergency, only thing not really extra.

You can cram down real estate that is not your residence.

[TheBajan]

Jr001,

I had a similar situation although it wasn't from gambling. I breed dogs and I report my income and expenses on a schedule C for income taxes. Every year, I end up with a loss. Just prior to filing, we sold a litter of puppies. I let our atty know about it. We never put the income in our budget because we usually end up spending more than we bring in so it's not reliable income. However, this year we expect to actually make a profit. I told all this to our atty and he said that we wouldn't include it in the means test b/c up to now, it's been a negative for us. So, even though we brought in $1700 for selling a litter, we spent a little over $2000 to produce that litter so it wasn't a concern to him. The next litter we have will gross about $10k. That will be a profit for us and we will probably end up having to make higher payments in our plan... I'm not entirely sure. Anyway, hope that helps. Like I said, not a gambling issue but income/expense situation sounded similar.
The Bajan

[karm43]

Good for them. Heck I must live in the wrong county and state. lol Not related to this but my attorney telling me cable and basic cell luxury when some people putting 100 a week for entertainment I put 100 month didn't want to rock boat. Oh well sorry for my wine..................

[jr001]

I did not put $100 a week for entertainment. I have no plan do date. No Bk 13 filed yet, I only went to one free consult and left with questions. I just asked about if the wins can be offset by any losses, as you are able to do on tax returns each year. I gave a hypothetical loss amount that covered the win, just to ask in this case would it be wiped out. or as an example win the dog breeder that posted the costs of breeding out weighed the income from the sale of the dogs. Yes, thanks, that is a similar comparison.

Cram down- We deserve it.
It would be mutually beneficial for both parties. Outstanding mortgage $128k, value $31-33k. We have been through years of physical and emotional challenges, since 1992. We lived in it, rented it, painted it, put down tiles, cleaned up human waste (poop) when tenants let the water go off and still lived there until eviction. We pulled up carpet saturated with cat urine and feces from another tenant family that keep 11 cats primary locked in the master bedroom, instead of one of the family members. Strange. It goes on.

But to Karm43 "Wow I don't think you could cram down a house. Its not a refinance loan, its for people who are struggling or who have made very bad decisions. Most people want a little extra just so they could save for emergency, only thing not really extra."
No it's not a refinance loan. But this will be a losing deal for the mortgage company. If I foreclose and walked away instead. They would be looking at standard one year of vacant property here in NV. It is taking that long for them to legally complete the process. New State laws made it tougher for them to foreclose. According to my loan payment that is a minimum loss of $11k, plus finance income they make. Now the property sits vacant, unless I kept it rented, as some people are becoming aware of and keep the income. I would feel concerned for the tenant to feel secure. But, while it sits vacant homeless people can sleep over or it can be vandalized and damaged. Now add the expensive legal costs they have for the foreclosure process. Then after all of that, they could have just lowered the cost of my mortgage down to fair market value the amount they will get any way, minus any realtor fees, commissions, repairs, legal fees etc. they will be lucky to get $31k not the $128k they have me on contract for and a year or longer the value may continue to drop. Do you think the mortgage Bankers were upstanding in their dealings? Keep in mind, if you read up, you will find about 80% or so of the loans have been sold and resold and then traded on the stock market and broken into little pieces with many investors. They have been paid over and over and when investigated they had no legal right to do this. This is not a vehicle that should be traded on the stock market, it changed the protection they had that governed it being a mortgage to something new. When challenged in court, as mentioned in the news a while back. The documents don't hold up in court. They do not have wet signatures on them of who's signed the loans, they were processed electronically stamped and some don't have both docs together signed that are needed to back the loans it court. They have no paperwork and the original people don't want to be found to sign in court now. Look up mortgages and wet signatures in Google you will see there may have been fraud here. They were selling and reselling to investors and repackaging what was a mortgage, changing it to a stock on wall street.

I've been researching to understand the Bk 13 process and am looking at the 6 month income prior to filing to decide when to file, as the Attorney suggested come back in 2 months. I have worked a lot of OT to be able to pay off, "settled as agreed" $26k in debt, a credit card and a personal line of credit. We were attempting to pay off our debts. This 6 months Dec to May would show a lot of OT, I worked 5, 6 and sometimes 7 days a week, 12 hr shifts. It also would show a cash out of 120 hours of PTO, there went my vacation, to juggle to pay our primary and not lose it to possible foreclosure. Used up more of my PTO when recently my dept closed and reopened 2x. I worked less hours. Had just paid the rental a few weeks before not to lose it. Had to put in a new water heater there, over $1300. Glass cover on front of new stove, damaged by previous renter. (our Daughter, bad choice) I would not be able to maintain that type of OT schedule for 5 years in a ch 13 plan. It's not accurate of a normal budget or how one should be, my Husband was planning to retire, I recvd a letter from my employer of layoffs, but haven't been called and may not. I have signed up for unemployment for the first week, yet to receive due to felt I was stupid to use up all of my PTO because of being called off, when I would qualify for unemployment if under 32 hours a week, with loss of hours. Not sure if that is right or not for BK? Then my department did open on Monday, I should go back as normal this weekend. All of this is a mind full to deal with and file at the right time with the best plan to live with. I am happy to hear of some of you that have achieved comfortable to live with plans and have learned along the way about budgets and finances. I hope to achieve this too. I am still in a state of confusion, but seeking knowledge and understanding.