Paying tuition before filing Ch 7

[maisy]

Hi,
Im new to the forum but had a question on what I'm allowed to pay before filing.

I could possibly receive a 1 time lump sum payment which in no way would cover all the cc debt I have but would allow me to pre-pay my child's tuition for next year at the private school they currently attend.

After that my income/expenses are clearly in line for Ch 7.

Is this payment allowable? I'm in PA.

Thanks for any info

[HHM]

Probably not.

First, where is the "lump Sum" coming from?

Second; how expensive is this private school (in monthly terms, if you didn't pay in advance, what would the monthly payment be).

Look at it from the bankruptcy court's perspective, why should your creditors not get paid so your child can go to "private school".

[maisy]

Money would be a gift from family member.
Monthly payment would be about 1500.00

[HHM]

Not going to fly.

This is a trickier scenario than you might think. First, the bankruptcy court is NOT going to allow a $1,500 per month private school expense anyway.

The only way around this (and it is still risky) is simply have this family member pay the tuition directly to the school (on a monthly basis). '

Whatever you do, do not accept this gift from the family member until AFTER your bankruptcy is over. You would be putting that money at risk of seizure by the bankruptcy trustee and if you spend it on the tuition, the trustee could conceivably go after the private school to get it back and request the court to deny you a discharge (for fraud).

[brokeinfl]

What if only one spouse is filing? My wife makes the private school payments, but it sounds like it would not matter in a bankruptcy situation.

[BCA2009]

We had a similar situation, except the monthly amount was much lower. Our attorney said that it would be fine for family (grandparents) to pay the tuition. It was not counted as income to us. This may vary district to district.

[lovebirds]

Have your family member pay the lump sum directly to the school and there will be no issues.

[mercedesc350]

Interestingly, and I don't know what all the numbers would have been, but when I was initially talking to my atty and he was actually convincing me that I could file ch 7, he asked if my kid(s) went to private school...I answered "no." He asked, "do they want to?" There was apparrantly some allowable amount for education which would have included private school. Again, I have no idea what the limit was on that...definately an allowance of $1500/month sounds a bit extreme.