Will file Ch7 in Jan 2022

[JellyBeany]

Due to my husband's unemployment, we dismissed our Ch13 as we could no longer afford the payments.

Our attorney is going through our bank statements and listing a bunch of stuff she says the Trustee will really focus in on. For example, every month I place an order for nutritional supplements to manage my thyroid condition and my migraine headaches. She says supplements aren't "essential for life" and should be dropped. We pay a monthly fee to our veterinarian for routine care for our 2 dogs. She says the same thing, that pets aren't "essential for life" and we should stop paying.

As of Jan 1, if he is still unemployed, we will be WELL below median for the 6-month lookback period. Will the Trustee really pick over stuff like vitamin supplements and veterinarian bills?

I don't want to jeopardize our Ch7 success but at the same time it seems crazy a Trustee would look so critically at this kind of stuff for below-median filers.

[justbroke]

If your attorney is looking at stuff at this level, they may be concerned that you are showing some amount of disposable monthly income (DMI). Remember, if the UST decides to poke around, they could attack a few expenses that are not essential to life. That last phrase -- essential to life -- is difficult to swallow. A learned bankruptcy judge once wrote that creditors should not have to go unpaid for lifestyle choices. The judge was talking about a debtor who was supporting his live-in girlfriend and her children. The judge opined that it was noble, but that bankruptcy law only looks to what's reasonable and what's legally required. The judge wrote that housing, feeding, and clothing the girlfriend and her children was a lifestyle choice and would not subject the creditors to that choice.

Yes, it seems harsh, but I think your attorney is saying that you have some DMI, and if the UST attacks a few expenses (veterinarian bills and supplements) then it could put you right back into a Chapter 13.

The problem is not the Chapter 7 Panel Trustee. The problem is if the UST seeks your prior income (over the past two years) and thinks that this is borderline (or that you're timing a new job/income), they could become curious. I always say, don't make the UST curious about your case, but there's usually nothing a person could do. I think the attorney is preparing you by saying that these types of expenses may be difficult to justify if the UST becomes interested in the filing. (You'll probably have that extra scrutiny because you're coming out of a Chapter 13 in less than a year.)

Just my thoughts.

[JellyBeany]

Thank you so much for your thoughtful response. I appreciate it. I admit I was a little surprised by your response as by Jan 1 we will be *substantially* below median, if he is still unemployed.

I need to look more into what might catch the attention of the UST, and how to deal with such a thing.

I've been trying to look up any cases where a *below median* Ch7 filer runs afoul of the UST.