Recent additions to monthly expenses

[kathy4530050]

Can anybody here help me with this? When you list your monthly expenses, do you have to be prepared provide evidence that you've had all of these expenses for 6 months? For example, I am currently uninsured, but if I choose to buy health insurance, can I add that to my monthly expenses even if it is fairly recent prior to the time of filing?

Thanks!

Kathy

[lrprn]

When you list your monthly expenses, do you have to be prepared provide evidence that you've had all of these expenses for 6 months?

It depends on the expense and how close the amount of the expense is to what is typical in your local community.

If you have an expense for health insurance and the premium is within the normal amounts seen in your area, then your trustee is very unlikely to question it.

However, if the health insurance amount you list is well above the norm for your area or is unreasonable for your personal circumstances, then chances are your trustee may question that. Whether your trustee will kick up a big fuss about the expense depends on what he/she normally does in that circumstance.

Look at it this way - a higher premium for health insurance is going to be more tolerable to the trustee than if you started a monthly payment on a vacation timeshare right before filing and added that as an expense

[kathy4530050]

It depends on the expense and how close the amount of the expense is to what is typical in your local community.

If you have an expense for health insurance and the premium is within the normal amounts seen in your area, then your trustee is very unlikely to question it.

However, if the health insurance amount you list is well above the norm for your area or is unreasonable for your personal circumstances, then chances are your trustee may question that. Whether your trustee will kick up a bi fuss about the expense depends on what he/she normally does in that circumstance.

Look at it this way - a higher premium for health insurance is going to be more tolerable to the trustee than if you started a monthly payment on a vacation timeshare right before filing and added that as an expense

lrprn: Are you saying then the trustee will me more concerned with what the expense is or how much it is than with how long I have had it?

Thanks!

[keepmine]

I don't see any issue with health insurance. It's not a luxury item. Also, do you have both long and short term disability insurance?

[kathy4530050]

I don't see any issue with health insurance. It's not a luxury item. Also, do you have both long and short term disability insurance?

No, I have neither. And I could certainly look into adding those, but again, my concern is what the potential outcome would be if I added these a month or two before filing. Would they still be considered legitimate expenses?
Except for the past six months, I've always had health insurance, but when my business sort of crashed, I cancelled it. Buying it again would be expensive, but if I could definitely claim it as an expense, I'll add it back in.

My question does not haver to do with whether or not it is a legitimate expense, but whether the length of time I've had the expense prior to filing limits my ability to include it in my monthly expenses.

For example, I have read here that charitable giving is a legitimate expense too, but you can't claim it as an expense if you decide to start tithing to a church the month before you file.

That's my question--with health insurance or any other expense. Can you include recent expenses that you have not had for many months prior to filing?

[jribe]

i think the biggest issue would be; with these recent expense additions- if the trustee disallowed them would you still qualify for ch.7?

If the trustee noticed these premiums being added in May; and then you file in July- they may want to know why you suddenly decided to get the coverage. If it was to qualify for a 7; opposed to a 13 they could find an issue with it.

I would just make sure you don't have a handful of recent expense additions right before you file...

[kathy4530050]

i think the biggest issue would be; with these recent expense additions- if the trustee disallowed them would you still qualify for ch.7?

If the trustee noticed these premiums being added in May; and then you file in July- they may want to know why you suddenly decided to get the coverage. If it was to qualify for a 7; opposed to a 13 they could find an issue with it.

I would just make sure you don't have a handful of recent expense additions right before you file...

Yes, that's my question exactly. I currently have too much disposable income and am looking at expenses I can include. Health insurance--I can't imagine who would quibble with that. We all need it. But I wonder about other things . . . . even like disability insurance, which I've never had.

[catleg]

It's just plain stupid not to have disability insurance. I'd like to see a lawyer tell you that you shouldn't have it, that would be an interesting argument.
I was diagnosed with type 2 diabetes when I was 38 and parkinson disease at 42.

[hopefulbk]

Adding to the disability and health insurance thing.. I plan on buying a policy after I save up some more money (obviously can't right now since I just stopped paying bills) but if they ask why.. that is simple. I am filing bk to get out of debt. Medical debt is one of the highest causes of debt for people and it would be dumb to go uninsured when your plate was wiped clean. Same for disability. I am the breadwinner, if something happens to me, we are done.

[keepmine]

Adding to the disability and health insurance thing.. I plan on buying a policy after I save up some more money (obviously can't right now since I just stopped paying bills) but if they ask why.. that is simple. I am filing bk to get out of debt. Medical debt is one of the highest causes of debt for people and it would be dumb to go uninsured when your plate was wiped clean. Same for disability. I am the breadwinner, if something happens to me, we are done.

There ya go! Post bk, you're extremely vunerable. Nothing wrong with using insurance to protect against large medical debt or, protect your income.

[kathy4530050]

Wow! You guys make a really great argument. Thanks a bunch. This is just what I needed.