Would BIL get in trouble if we file?

[tdgirl]

We had to move in with my brother-in-law a couple of years ago due to my boyfriends (we've been together 11 years, I figured it would be easier to say BIL than my boyfriends brother here) pitiful paycheck and my pending disability case. We pay my BIL a small amount to live in one of the bedrooms, use of kitchen, etc. BIL filed Chapter 13 about a year ago and I assume he did not report what we pay him on his paperwork.

Because of a wage garnishment on my boyfriends paycheck, my boyfriend will have to file Chapter 7. His wages were garnished for nearly two years, about two years ago and because he makes so little money, all we managed to do was pay the interest and not a single dime of the principal. Needless to say, Chapter 7 is the only way out now. We are so poor that there is no way we can hire a lawyer to help, so I'm having to figure everything out for myself.

To my question. Since we pay BIL and he did not report that payment on his Chapter 13 bankruptcy, if we were to file, I assume we have to give his name to prove we pay rent. Would BIL get in trouble with his own bankruptcy? There is no way we can ever move out unless we lived in our car. We are only left with $37/wk after the garnishment is taken out, rent, insurance and gas money. So when I say we are poor, we are seriously poor and an attorney is just out of the question.

Thanks for any suggestions or help you can give.

[tcreegan]

Hi tdgirl, and welcome!

I assume he did not report ...find this out for sure, if he included it in his Ch 13 plan that solves the whole problem.

Are you planning to file together or just BF?

What are we talking about for the rent? Is it going to his mortgage or just paying expenses, utilities, etc ?

[tcreegan]

...$*(W^R computer...sorry for the split post....

How close is the monthly income to $3229 (GA median income)? (gross, b4 deductions)

With a little bit more info, folks here will be able to help you much better!!

Welcome aboard,

Tom in Colo

[tdgirl]

I'm fairly certain he did not report but will check. I'm not sure what we are paying him is going toward, I guess whatever utilities we use and then mortgage. We only pay $300/month.

The monthly income before deductions, taxes is $271/wk, that's about $14k/yr. After taxes was $220/wk, after garnishment is $160/wk. When he had his wages garnished 2 years ago, he was laid off and on unemployment for a while and then his job hired him back, going on over a year now, last week is when they started doing the wage garnishment again.

Just my boyfriend is filing bankrupt.

[researchnerd]

Welcome to the forum! We have quite a few people here from GA.

I suspect your BIL is not really an issue. I'd just refer to your him as your landlord and leave it at that. If they had to check up on every individual landlord to find out whether they ever filed Ch13, the courts would be a lot more backed up than they are already. Also, bankruptcy is considered a snapshot of your situation at the time you file. If your BIL filed more than a year ago, and you've been renting from him for less time than that, he should be fine.

For what it's worth, we were never asked to prove who we pay rent to. They asked for a couple of bank statements, and the rent checks were included in there, but there were no questions asked about it.

$37/week is pretty rough for two people. If you haven't already, I suggest checking out COMPASS to find out what assistance is available to you.

[jcj112562]

Oh, and make sure you get what help you can, either with Legal Aid (if you qualify), ask about pro bono, or just get the NOLO Press book for Chapter 7, read, fill out the forms, and file it. I had no issues filing my Chapter 13 here (Atlanta), and now, I am just waiting for the trustee to close out the books, and for the discharge.

John

[tdgirl]

We've been paying BIL since before he filed and we pay in cash. And since it is the same address and last name for both of them, I think it could be easily found out, even if it was just a paperwork mistake.

I forgot another question. When my boyfriend has to show his bank statements, PayPal and eBay will show up. The problem is that we've been selling a few high dollar things ($200-$400) for a friend in trade for a phone and a laptop. We didn't make a dime from that except for the two electronics, but since PayPal shows up on the bank statements, I guess that is going to look like we are making money selling things, which we aren't. How would we handle that?

And also, in Georgia are we allowed to write the 2010 income tax refund off as an exemption? The refund will only be about $600-$1000, depending on what the government does before the end of the year. He does't have any other assets but a non-working van and a barely working car he drives to work. We needed to either fix or buy another car since the one he is driving now is about to go out. Other than that and his clothes, furniture and a computer, we have no other exemptions or assets. Looking at the exemptions list, I didn't see anything about income tax.

I really appreciate your help. This has been really difficult and stressful trying to figure this all out.

I checked out the book from the library yesterday and have been reading it, which is why I'm almost confident we might be able to handle it ourselves instead of a lawyer, which we couldn't afford anyway. I tried legal aid but they said because we don't own a house, they couldn't help.

[tcreegan]

$271/wk, that's about $14k/yr. After taxes was $220/wk, after garnishment is $160/wk ....good grief, this is not scraping the bottom of the barrel, you're through that and digging underneath....

...We are only left with $37/wk after the garnishment ...and how you manage that is an amazing example of budgeting..

high dollar things ($200-$400) ...for what you are managing to get by on this is high dollar, but not to a BK trustee

To help you size things up: the median income in GA is $807 a week

All the 'stuff' will be exempt under GA BK exemptions, since he doesn't own a home, he will have a $5,000 'wildcard' which will exempt the tax refund.

Was the library book the NOLO book? If not, see if they have it.

Keep asking questions here, lots of good folk to help you through this...

Tom in Colo

[tdgirl]

Yes, it is the NOLO book, it says 2009 on the front. $37/wk, we basically eat a hell of a lot of potatoes and Ramen Noodles. We are having to get on Food stamps for a while, I hate it but at least we can have bread with our potatoes now.

The high dollar things on eBay, we didn't get any money from but just a laptop and a phone (heck, the laptop was broken but boyfriend fixes them to resell them, through friends not on ebay and not much money and only a few times/yr), which due to our poorness he can't even buy the parts to fix it, so it just has been sitting in a box collecting dust.) So whatever money shows up as receiving from PayPal, it is taken out to give to the friend whom we sold it for. That is why I'm not sure what to do about it or even if the trustee would believe us about it.

I just did a quick calculation for Oct. and it shows as receiving $1662 through PayPal, even though 80% of that was for the friend, the other 20% of that was selling anything my boyfriend had of value in order to fix our old car, that turns out didn't fix a darn thing and we had to get another car (which was given to us in trade.) But the other months are not even above $100, most aren't even over $50 from money being received and if it is most of it is usually my mom sending us money. I went back the last few months and whatever money we received each money, we still didn't break over $1000/month (total I mean, as in PP+wages before taxes.) Except for the month of Oct when we sold the stuff for the friend. I'm not worried about the other months, just the month of Oct that makes it appear like we are selling and making money when we aren't for that month (at least as much as it shows as being received.)

Glad to hear that we can exempt the tax refund, that's a huge relief. But I did find out that the brother-in-law did not report our rent as income on his paperwork.

I'm wondering, since we are so poor, is there anything we can do to stop the garnishment besides bankruptcy? We are really afraid of getting BIL in trouble if we have to show who we are paying rent to. And we pay by cash, so if we do have to prove it, how could we even prove we pay him?

Again, I appreciate all your help.

[tdgirl]

I don't know why I'm worried over PP anyway, looking at the means test again, we are far from the median income, even with that stupid PP amount for Oct showing up! So, forget that question.

[tcreegan]

I'm wondering, since we are so poor, is there anything we can do to stop the garnishment besides bankruptcy?

....[banging head on table]....how could I miss that!

If the garnishment is the only thing you are doing the BK for, you don't need a BK

1) if the garnishment is for court-ordered payments (child-suport, alimony, taxes, restitution, etc) it won't get discharged in the BK anyhow, so no point filing.

2) The maximum garnishment in GA is 'the lesser of 25% of disposable earnings or the amout earnings exceed 30 times the federal min. wage'

30 X 7.25 = 217.15 Boyfriend disposable income 220 - 217.15 = $2.85 maximum garnishment

You are either stuck with #1 or need to find out how to get the garnishment down to the legal max of $2.85 a week.

Need one of the lawyers around here to chime in on the process to fix the garnishment...

Tom in Colo

[tdgirl]

Yes, it is the only reason he'd file bankruptcy is to stop the garnishment. Holy hell on a broom stick, are you telling me we could have fixed this years ago? Lawyers are the ones that started the garnishment in the first place, I'd assume they would have looked at it and knew the law enough to know they were breaking the law by doing that. But I always assumed that was calculated to be before taxes, not after taxes, so thought there was nothing we could do but file bankruptcy.

I'm so confused over this, I also read that the collector can only charge 12% a year for interest, yet the collection lawyers are charging 18%, or am I wrong? How can they do that?

I must clarify that my boyfriends job has laid him off down to only 32 hours a week, so he doesn't work a full 40 hours, would that make any difference?

I've been doing searches for stopping wage garnishments and everything always says 'consult a lawyer.' Which, I know they will suggest something in the consultation but further than that, we couldn't pay them anything to help stop it. What's stupid is that way back when during the first garnishment, I thought it was only going to be a couple of dollars deducted, but when it wasn't I figured I just didn't know what I was reading. I hope you are right!

I found a wage garnishment worksheet from 2008, when he was working a full 40 hours at higher hourly pay. But now he is making a lot less at shorter hours.

[tdgirl]

Oh boy, I am so confused. If he is only suppose to be charged the lesser of 25% of disposable earnings or the amout earnings exceed 30 times the federal min. wage, His net pay in 2008 averaged $250/wk. Min wage then was $6.55 (x30=196.50), so $53.50 difference. Or 25% is $62.50, which is what came out back then. If it is suppose to be the lesser of the two, then why wasn't it $53.50 instead of $62.50? That is where I'm confused about if they are taking out too much this time, since they did it that way last time.

Who set the amount being taken from my boyfriends paycheck? If only $2.85 is really suppose to be taken out, then is it the person doing the paycheck/accountant suppose to know that they should only take out $2.85 and not 25%? Or is it a court order that said 25%, because looking at all of the paperwork, I don't see anything saying 25%, only that the creditor won the judgment and the amounts and everything.

[tdgirl]

I just realized that up until two months ago, he was bringing home less than the $217.50. Before that he worked nearly a year without being re-garnished. I just wonder if that is why they started the garnishment again, because he started to make more than the $217.50?

I've been researching all day, my brain is about to explode, so I hope my questions make sense.

The last two weeks, the woman who does the checks at boyfriends work, she has been taking out below the $217.50 requirement, which if I am correct is against the Credit Protection Act. Is there any way to get some of that money back? We are talking about $100+ here, which as you've read previous is a hell of a lot of money for us.



MODS: I know I am now talking about wage garnishment instead of Chapter 7, so if you need to move this thread over to the wage garnishment forum please do.

[tdgirl]

Just an update for you.

It turns out the woman who does his paycheck has an old wage garnishment form for calculating the garnishment. It is showing as federal minimum wage is $5.15 NOT the current min wage. After this Thursday he'll have $180 garnished when it should only have been $11.

Is there any way to get a refund from the amount of over payment? I'm guessing the $700 over payment from 2008 is lost but can anything be done about the over payment in the recent garnishment? The office woman refuses to change anything, what can we do to get her to stop garnishing so much money? She is violating a law isn't she?

Another week or two of this and we'll be living in our car.