Understanding I &J

[Rick9972]

Let me see if I understand this right. If Income on I minus the expenses on J leaves too much left over, then I can be forced into Chapter 13?

Next question is how much left over is too much?

As a comment, me and DW are having alot of problems with Schedule J. Most of the things listed there have been unknown luxeries for so long, we really have no idea what "normal" costs would be.

[eddiep]

Well I too am not sure how much is too much but... I do have a link to a web site that will help you with standard expenses. Hope it helps.

http://www.usdoj.gov/ust/eo/bapcpa/20090315/meanstesting.htm

[Rick9972]

Thanks eddieP that was a good source.

I have now completed the budget Question I have now is I am spending about $360 more than we make.

On a Chapter 7 where does the budget need to be?

[JoeBankrupt33]

On my BK, we were spending about $100 more than we earned. I think a little negative is where you want to be. Also, if any single item is disputed, then you have a little room to still be negative.

[amalejko]

Understanding I &J

I filed a couple of weeks ago. My attorney said we could not be in the negative or we would be forced to file chapter 13...we reduced our expenses and filed with $100 in the positive...

[mamaluv]

I filed a couple of weeks ago. My attorney said we could not be in the negative or we would be forced to file chapter 13...we reduced our expenses and filed with $100 in the positive...

That's actually backwards...you cannot be too much in the positive or you will be forced into a 13. If you are in the negative you are spending more than you are bringing in, therefore you have no money to fund a 13. I can't remember what the magic number is when it comes to DMI...something around $160.

[eddiep]

Rick,

Are these your actual expenses, that do not exceed the "standard allowance"?

I did not exceed the standards except the housing standard, but there is no way to cut that down. My actual costs are below the standard on the auto allowance, clothes, and food costs.

A little give and take I guess. I come up with $125 extra, but I think I will go a little closer to the standards on the car and food to show a negative too so that way if the trustee objects to some of my expenses I will still come up short.

I figure I will stay close or below the standard in any catagory that the trustee my object to.

Not to be too nosey but are you really running that short each month? Things are going to be tough if you are. Remeber if you actually exceed the standard you will have to prove these expenses.

[albacore44]

Rick,

Are these your actual expenses, that do not exceed the "standard allowance"?

I did not exceed the standards except the housing standard, but there is no way to cut that down. My actual costs are below the standard on the auto allowance, clothes, and food costs.

A little give and take I guess. I come up with $125 extra, but I think I will go a little closer to the standards on the car and food to show a negative too so that way if the trustee objects to some of my expenses I will still come up short.

I figure I will stay close or below the standard in any catagory that the trustee my object to.

Not to be too nosey but are you really running that short each month? Things are going to be tough if you are. Remeber if you actually exceed the standard you will have to prove these expenses.

Do you just take the full standard even if your costs for that catagory aren't quite that high ??

[eddiep]

No, it says that you should take the standard, but if your actual expenses are lower you should use that number. If you take over the standard you will need to provide proof that these expenses are higher. But expenses like food, clothing, auto repair fluctuate.

[Rick9972]

Do you just take the full standard even if your costs for that catagory aren't quite that high ??

No. The only things I took full standard on was food, clothing and auto expense. If I varied from the standard is was due to receipts in hand being higher or lower.

The one big one for me is medical. Not real sure how to address it on my budget. I have good insurance and FSA. When I deduct what the insurance payed and the FSA from my medical bills, I still payed out of pocket over $1000 per month for the last six months. I divided that in half, (hopefully it will be enough) and put $500 in my budget. *shrugs* perscriptions are about $239 per month, hopefully we stay healthy and away from the doctor.

[eddiep]

Sorry to hear about the medical problems and I hope these are not ongoing health problems.

[albacore44]

No. The only things I took full standard on was food, clothing and auto expense. If I varied from the standard is was due to receipts in hand being higher or lower.

The one big one for me is medical. Not real sure how to address it on my budget. I have good insurance and FSA. When I deduct what the insurance payed and the FSA from my medical bills, I still payed out of pocket over $1000 per month for the last six months. I divided that in half, (hopefully it will be enough) and put $500 in my budget. *shrugs* perscriptions are about $239 per month, hopefully we stay healthy and away from the doctor.

Man thats a lot for medical. I have an HMO with a $10 per visit copay, nothing else except prescription copays which come out to $75 a month. My bigee is mortgage. 1st,2nd,ins, and taxes = $3400 a month. then my utilities are higher than the standard due to the bigger house. But i'm in ca. and we have case law governing high mortgage expense so the trustee should not be able to object.

[Rick9972]

Sorry to hear about the medical problems and I hope these are not ongoing health problems.

Appreciate it! Unfortunately they are ongoing. But I still manage to get up and go to work everyday. Have not been late on any payment, but can see the handwriting on the wall. If not this month, then next and then the fun with collection calls really begins. (been there done that and never want to go back again)

Trying to get the 7 filed this week.

[eddiep]

hang in there rick
Once you get your financial issues worked out you will have more energy to tackel the health issues. Let me know how it goes with the lawyer this week!

[trueblues]

I have good insurance and FSA. When I deduct what the insurance payed and the FSA from my medical bills, I still payed out of pocket over $1000 per month for the last six months.

I'm confused. Why did you deduct the FSA amount? Seems to me you still paid out the money for medical expenses, you just weren't taxed on it. Right?