Under State Median Income, is it really that simple?

[keezeed]

I've been considering CH13 BK for awhile, but recently decided to go for CH7.

That being said, I understand that I am under the median income fo my state. Am I eligible for CH7 just because of that ?

I guess my question is this: You can choose CH7 even if you could manage a CH13 as long as you are under the state median?

Interesting...

Also, would someone confirm that the median state income for a two-person household in Virginia is currently $62,926.

That would mean that if my wife and I averaged under 31,463 in the look back then we are OK to file CH7 regarless of whether we could make a CH13 work or not?

Thanks in advance!

[keepmine]

Just because you are under the median does not mean you automatically qualify for a Chapter 7. You still must fill out schedukes I and J to determine if you have enough disposable income to fund a 13.
Fill this out and see where you stand.

http://www.legalconsumer.com/bankruptcy/means-test/index.php

[aces67]

Just because you are under the median does not mean you automatically qualify for a Chapter 7. You still must fill out schedukes I and J to determine if you have enough disposable income to fund a 13.
Fill this out and see where you stand.

http://www.legalconsumer.com/bankrup...test/index.php

This is correct. Your I and J will show if have money left over every month.

[keezeed]

Thank you for the help! I had a feeling it wasn't that simple.

What if you fail the means test but show extra income on Schedules I and J?

Also.. as far as the I and J forms, can I put a legitimate monthly expense on there that will be there the next 12 months but has not been there for the past 6 months?

Part of my decision to file is to free up the gobs and gobs of money that go towards interest and irresponsible consumer debt and commit some of that money to my church and other 'charitable' causes.

I haven't been doing that but I will start doing that soon so that being said, I can't substantiate that I have been doing that, but I know I am entitled to designating up to 15% of my income to things like that. I would be willing to substantiate the income being sent to those establishments after the bankruptcy goes through, but at that point wouldn't it be irrelevant?

Main question: Can I put religious contributions of up to 15% on my I and J forms if I haven't been doing it in the past but plan to add that to my budget?

Thanks!

[aces67]

You need to ask your lawyer about that. When the trustee goes over your papers they can ask to see receipts for those contributions.

Have you done an I and J just to see what it shows? You should do one before seeing your lawyer. Fill it out and see what's leftover. Then if you have money leftover post here how much and maybe we can help you think of things you may be leaving out.

Go back through your bank statements for the last 6 months and write down all your regular expenses.

[AngelinaCatHub]

Thank you for the help! I had a feeling it wasn't that simple.

What if you fail the means test but show extra income on Schedules I and J?

Also.. as far as the I and J forms, can I put a legitimate monthly expense on there that will be there the next 12 months but has not been there for the past 6 months? Yes if legitimate. Not sure if a charitable contribution or even tithe is counted as it is a choice you make. You must wait at least six more months though.

Part of my decision to file is to free up the gobs and gobs of money that go towards interest and irresponsible consumer debt and commit some of that money to my church and other 'charitable' causes. I applaud you for the charities, and once you get your "new start" you will be responsible in the future. Right?

I haven't been doing that but I will start doing that soon so that being said, I can't substantiate that I have been doing that, but I know I am entitled to designating up to 15% of my income to things like that. I would be willing to substantiate the income being sent to those establishments after the bankruptcy goes through, but at that point wouldn't it be irrelevant? If you have been doing this all along and can prove it, perhaps.

Main question: Can I put religious contributions of up to 15% on my I and J forms if I haven't been doing it in the past but plan to add that to my budget?

NO! You are swearing under oath at your 341 that your schedules are correct. They are a History and you cannot change History. You have not been doing that for the last six months. Good intentions are not retroactive.

Thanks!

I will look this up for you for a better explanation as to what you can exempt in charity. 'Hub

[RackingJ]

This link really helped me figure out expenses that I would've forgotten about.

http://www.ca-bankruptcy-attorneys.c...alculator.html

[AngelinaCatHub]

(A) the amount of that contribution does not exceed 15 percent of the gross annual income of the debtor for the year in which the transfer of the contribution is made; or
(B) the contribution made by a debtor exceeded the percentage amount of gross annual income specified in subparagraph (A), if the transfer was consistent with the practices of the debtor in making charitable contributions.

http://www.law.cornell.edu/uscode/uscode11/usc_sec_11_00000548----000-.html

[keezeed]

Also.. as far as the I and J forms, can I put a legitimate monthly expense on there that will be there the next 12 months but has not been there for the past 6 months?

---Yes if legitimate. Not sure if a charitable contribution or even tithe is counted as it is a choice you make. You must wait at least six more months though.

Main question: Can I put religious contributions of up to 15% on my I and J forms if I haven't been doing it in the past but plan to add that to my budget?

--- NO! You are swearing under oath at your 341 that your schedules are correct. They are a History and you cannot change History. You have not been doing that for the last six months.

Are you saying that in order to have a religious contribution on my I and J forms I would have to wait six months until I could prove that it is a legitimate expense for me?

In essence I would be waiting six months to create a legitimate expense which doesn’t make sense.

Also... question 19 on Schedule J says:

19. Describe any increase or decrease in expenditures reasonably anticipated to occur within the year following the filing of this document:

Would I be able to answer this with my intent to make charitable contributions?


Thanks again!

EDIT:

I recently hired a person to mow my lawn and have only paid him one month so far but this will be an ongoing expense, can I include this in my I and J forms ?