How much does each creditor get?

[dakota112]

The trustee is going to notify my creditors that I have a tax refund so I was converted to an asset case now after my 60 days. How does he know how much to disburse to each creditor when they are notified? Is this random or is an equaly percentage given to each? At most they will get 2 cents on the dollar. Seems kind of alot of paper work .

[liz417]

Hey, it's not too much work because the Trustee gets a percentage of what he recovers (you tax refund)

[SMinGA]

I understand it to be relative to the portion of unsecured debt for each creditor.

If you owe A $10,000, B $5000, and C $15,000 and they are the only 3 claims, A would get 1/3, B 1/6, and C 1/2 of the amount that remains after the trustee fee.

[montana59451]

How much is the trustee fee? The TT has already stated the tax refund we have coming (from EIC credit and Fuel tax refund) is going to her as well as our 2010 refund (which I will see to it she will not get as I plan to take more exemptions and have to pay IN next April). I see this as " adding insult to injury". I don't seem to be able to exempt this under MT bankruptcy law so yes...I am pissed

[CCsAreEvil]

I hear ya montana. I'm in the same boat. I would think the EITC would be exempt but since I made very little and have kids, that was the big gain for my refund amount. Just finished my taxes, but I know the trustee could care less and will take the max he can. We still need to look at the flipside: being fully discharged and having to pay this small price for it in the grand scheme of things (well, also with shot credit and BK record).

[dakota112]

Its all part of this business. Everyone feeds off of us until there is nothing left to take and than they move on to the next. You can't take it personally. It is the american way I guess.

[bktmom28]

From what I have understood, the TT gets his/her portion first, which is 25% up to the first $5000.00, from there they get 15%. After that the attorneys for the TT's gets a portion and then divide it out among prioritized creditors. Not really sure how that gets figured when they are all unsecured, but whatever. My attorney asked the TT if I would get back my EIC as it is considered exempt in OR, and the TT said that's true, it is exempt, but if there are any bank accounts or other assets that are above the exemption level, it gets taken. As far as I know, we had no other assets besides our $2700 tax refund, so I am waiting for my case to close. Last day for creditors to file claims was March 3, 2010. Anyone have any idea how much longer it could be?

[dakota112]

Bktmom28: did you at least have your BK discharged on PACER while awaiting the close and disbursement of the tax refund?

[montana59451]

So under that premise my $1936 refund less filing fees of $170 (I told turbo tax to take it out of the refund ha ha) and assuming that the TT takes the 25% of the entire amount $484.00

$1936.00 Total Refund
-$170.00 Tax Filing Fees
-$484.00 TT Cut
___________

$1282 to divide up between 49 creditors a whopping $26.16 each!

[bktmom28]

Yes, our bankruptcy was discharged on Jan 11 2010, and we thought that we were going to have to mail our refund in after we had it automatically deposited, but the TT intercepted it I guess you could say, and the check went directly to her. Now we are awaited closing.

[dakota112]

Bktmon: how long after your 60 day post 341 did it take for you to get the discharge?
Thanks.

[bktmom28]

We had our 341 on November 12 2009 and our discharge came on January 11 2010. I was relieved to get the discharge but being an asset case, I am waiting for the closing as well. My attorney told me that it can take 9 months from the date of filing which seems crazy to me, as we only had our refund from our 2009 taxes, but I will just keep waiting.