Credit counseling and expenses

[pa308]

Ok, I know I have asked alot of questions on expenses and I swear this will be the last.

I will be filing in mid May and am now getting ready to do my credit counseling course on START FRESH TODAY. I understand that I need to have my expenses handy for doing it online with my wife.

My question, does what I list on there end up compared to my schedules I and J that I will file with my 7 petition. Does the trustee end up seeing the budget that you list on the counseling?

In the situations where the IRS says "Taxpayers and their dependents are allowed the standard amount monthly on a per person basis, without questioning the amounts they actually spend." I will list those amounts as my expenses (i.e out of pocket health care, food and clothing ) and where it says actual or the allowance whichever is lower I will list which ever is lower. Based on my reading and research here I believe this would be correct for the counseling, as well as the schedule J (of course I will go over all that with our atty).

I am due to receive a 2500 one time bonus April 31st. Is there any benefit to doing my credit counseling before then? Also will be getting my annual raise (usually 3-4%) April 1, I dont know the amount yet.

Getting closer and closer to actual filing. I apologize for all my questions but I want to get this right the first time and hopefully have noooooooo problems

[diviaruba]

Ok, I know I have asked alot of questions on expenses and I swear this will be the last.

I will be filing in mid May and am now getting ready to do my credit counseling course on START FRESH TODAY. I understand that I need to have my expenses handy for doing it online with my wife.

My question, does what I list on there end up compared to my schedules I and J that I will file with my 7 petition. Does the trustee end up seeing the budget that you list on the counseling?

In the situations where the IRS says "Taxpayers and their dependents are allowed the standard amount monthly on a per person basis, without questioning the amounts they actually spend." I will list those amounts as my expenses (i.e out of pocket health care, food and clothing ) and where it says actual or the allowance whichever is lower I will list which ever is lower. Based on my reading and research here I believe this would be correct for the counseling, as well as the schedule J (of course I will go over all that with our atty).

I am due to receive a 2500 one time bonus April 31st. Is there any benefit to doing my credit counseling before then? Also will be getting my annual raise (usually 3-4%) April 1, I dont know the amount yet.

Getting closer and closer to actual filing. I apologize for all my questions but I want to get this right the first time and hopefully have noooooooo problems

[pa308]

Thanks for the input Diviaruba. I am actually under the median so from what you are saying I will need to use actual estimates for the schedule J. I wasnt sure if the credit counseling data made its way to the trustee so i want to be consistent between the two. There could however be adjustments if I do counseling this month and file in May.

[pa308]

Diviaruba does the section you are quoting apply to chapter 7 bk? I failed to state i will be goin 7 and looking up Section 1325(b)(3) it seems to speak about chapter 13 with no reference to 7.

[diviaruba]

Diviaruba does the section you are quoting apply to chapter 7 bk? I failed to state i will be goin 7 and looking up Section 1325(b)(3) it seems to speak about chapter 13 with no reference to 7.

actual

[pa308]

[diviaruba]

Just part of the bad drafting of the 2005 law. 707(2)(A) gives instructions as to completing the Means Test - the B22 form which was not completed at the time the law was passed. If you complete the form per the instructions, which incorporate median incomes as defined in 707(7)(A), and are below the state median for your family size, you do not complete the expense portions and the presumption does not arise.

However, 707(2)(c) still requires the Schedule I & J to be filed, with the debtors projected income and expenses at the time of the filing. There are many courts that have taken the position that these schedules are dispositive for determining below-median debtors abillity to pay, that the means test was only a safe harbor for the debtor against the "presumption" of abuse, and that the debtors are not beyond the reach of paragraph (b)(3)’s comprehensive, statutorily-mandated inquiry into their fitness for chapter 7 relief.

See In re Pak and In re Paret for below-median debtors whose cases were dismissed or offered the opportunity to convert to Chapter 13, based on ability to pay under a totality of the circumstances challenge by the UST.

[pa308]

Thanks so much. You seem to have a thorough knowledge of the code. Are you an atty?

[pa308]

diviaruba,

My attorney concurs and said to provide him with actual expenses. For clothing we have been pretty much spending a little more than zero for a family of four. Especially with the fact that i am giving atty 350 per month to pay him. So I put zero for clothing right??

[diviaruba]

diviaruba,

My attorney concurs and said to provide him with actual expenses. For clothing we have been pretty much spending a little more than zero for a family of four. Especially with the fact that i am giving atty 350 per month to pay him. So I put zero for clothing right??

Nah, try to think back over the last year, before your expenses were distorted by attorney fees. A family of four needs to replace clothing on a regular basis. It would not be unreasonable to spend $30-60 per month per person, right?

[CindyLou]

Just a thought......are you SURE you are at least 5000 under the median? That 2500 will be doubled to get the annual amount.

If you are even close (within 7000) I would certainly talk to your attorney about your bonus in case you need to file sooner...

[pa308]

Just a thought......are you SURE you are at least 5000 under the median? That 2500 will be doubled to get the annual amount.

If you are even close (within 7000) I would certainly talk to your attorney about your bonus in case you need to file sooner...

I make 49400 per year before bonus. Median for PA is 70k odd so I think I should be ok. That doubling it is only for the means test right? My thought on the I is actual and I have a lettter saying it is a one time bonus for my good work.