Turned to asset case after Discharge

[idahodude]

Hello everyone,

I have a quick question for everyone. My inlaws filed for Chapter 7 in November of 2010, and were discharged on 03/09/2011. About 2 weeks ago, when looking around on pacer (I myself filed ProSe March 14th, and has gone flawlessly with a discharge date of 06/20), there case suddenly went from No Asset to Asset, with the Trustees office sending out a request for proof of claims (There were no original claims filed before discharge), with a proof due date of 08/2011. From my understanding, unsecured creditors get 60 days past the Discharge date (Per BK rule 3002c) to file claims, which was back in the very beginning of May, and government entities get 180 days. Also, posted yesterday was a request for the rest of their tax refund, due in June, even though from what Ive read and understand, the trustee can only take the portion of taxes due after filing, so basically 1/12, or at most 2/12th of $5100. There attorney doesnt call back anyone, has made many mistakes on their paperwork, and basically doesnt inform them of anything that happens. I end up giving them information almost 2 weeks before their attorney or the paralegal in the office notices it, even though "they check pacer dailt"

Does any of this make sense to anyone? Any advice I can give them besides a link to this thread for their attorney (They have given permission for me to speak with the Attorneys office, waiving confidentiality, but of course after that was given, he and his office doesnt answer my phone calls)

This case is filed in the Salt Lake City UT district if it really matters.

[despritfreya]

In response:

“My in-laws filed for Chapter 7 in November of 2010, and were discharged on 03/09/2011.”

The entry of the Discharge has no impact on the Trustee’s administration of the Estate.

“About 2 weeks ago. . . (the) case suddenly went from No Asset to Asset, with the Trustees office sending out a request for proof of claims. . . with a proof due date of 08/2011. From my understanding, unsecured creditors get 60 days past the Discharge date (Per BK rule 3002c) to file claims. . .”

You are mistaken. Read Rule 3002(c)(5).

“Also, posted yesterday was a request for the rest of their tax refund, due in June, even though from what I’ve read and understand, the trustee can only take the portion of taxes due after filing, so basically 1/12, or at most 2/12th of $5100.”

Not sure how you came up with your # since your In-laws filed in November, 2010. The Trustee gets the lions share of the 2010 refund since November was the 11th month of the year.

Due to the size of the 2010 refund the case is now an asset case. This does not impact your In-laws since they have their discharge. It just means that creditors will get something rather than nothing and it will take time for the Trustee to close his file.

Hope this helps.

Des.

[idahodude]

Thanks Des. One other question for you.
The bulk of their Refund is Earned Income and Child Tax Credits. Are there any restrictions of those when dealing with Bankruptcy, since I believe some districts and courts (The one I am in for Example) consider those public/government assistance and therefore exempted? Of course, when looking at their schedules, theres no exemptions filed for any type of public assistance, but then again, different courts have different guidelines.

Obviously I'm not an attorney, but Id like to give them at least some reassuring information since apparently there attorney doesn't like to answer calls.

[despritfreya]

The issue with EIC is going to be State and jurisdiction specific. For instance, in my State there is no exemption and it is just considered part of the tax refund so the Trustee gets it.

Des.

[idahodude]

Thanks again!