Church and Faith based schools

[2muchcc]

We give $15 dollars a week to our church and have to as part of our agreement to our sons school on top his tuition is $3200. His tuition is paid up. We may owe a little doe to not volunteering enough hours (because I work) Catholic school is so very important to us. Will this have an effect on our bk. Can we say that our parents will pay the tuition if necessary, which they would.

[CindyLou]

The 15.00 per week would be counted under charitable donations. Someone else will need to chime in on the tuition.

[2muchcc]

What happens with charitable donations?

[seanf12]

I am interested in this answer as well. Our son is in a Catholic school and I am not sure how this will be affected by BK, especially in a Chapter 13

[HHM]

Most trustees will accept up to 10% of your income to charity. (you can thank the mormons for that )

[diviaruba]

I am interested in this answer as well. Our son is in a Catholic school and I am not sure how this will be affected by BK, especially in a Chapter 13

On the Chapter 13 Means Test Form (B22C), you are permitted $137.50 per child per month for elementary or secondary school expenses:

Line 43 Education expenses for dependent children under 18. Enter the total average monthly expenses that you actually incur, not to exceed $137.50 per child, for attendance at a private or public elementary or secondary school by your dependent children less than 18 years of age. You must provide your case trustee with documentation of your actual expenses, and you must explain why the amount claimed is reasonable and necessary and not already accounted for in the IRS Standards.

This same language is found on Line 38 of the B22A for Chapter 7.

[seanf12]

Right, but what about in a Chapter 13 plan (on your schedules essentially). Are you allowed to "budget" an expense that entails the entire tuition amount each month?

[diviaruba]

Right, but what about in a Chapter 13 plan (on your schedules essentially). Are you allowed to "budget" an expense that entails the entire tuition amount each month?

Probably not. It is highly unlikely that a trustee or UST would let anything higher than the standards slip by them, reducing the disposable income payable to creditors.

[seanf12]

Thanks

While we are on the subject on charities, we also donate to charities (and also show this this on our tax returns; around $450 a year). However, we don't have any receipts or any documentation that proves this. Will this be a problem when it comes time to file (either Chapter)?

[diviaruba]

Thanks

While we are on the subject on charities, we also donate to charities (and also show this this on our tax returns; around $450 a year). However, we don't have any receipts or any documentation that proves this. Will this be a problem when it comes time to file (either Chapter)?

It will depend on how hard-nosed your trustee is. If they want strict compliance with the new IRS rules, which do not recognize even de minimis cash contributions as deductible unless a receipt is provided, then it might be a problem.

After the law changed in 2007, the cash you put in the collection plate, and which for years was unquestioned, became subject to new record-keeping requirements for deductibility for filers who itemize.

"New recordkeeping requirements for cash contributions. You cannot deduct a cash contribution, regardless of the amount, unless you keep as a record of the contribution a bank record (such as a canceled check, a bank copy of a canceled check, or a bank statement containing the name of the charity, the date, and the amount) or a written communication from the charity. The written communication must include the name of the charity, date of the contribution, and amount of the contribution. See Records To Keep." http://www.irs.gov/publications/p526/ar01.html

[keepmine]

Here's a Chapter 13 case that may {or may not} help.

http://www.bkforum.com/showthread.php?t=12511&highlight=keepmine

[diviaruba]

Here's a Chapter 13 case that may {or may not} help.

http://www.bkforum.com/showthread.ph...light=keepmine

Below-median debtors in that case. Above-medians are held to the standards.

Some "belows" think it's not fair that they cannot use the standards for transportation, housing, food, etc., which often-times are quite a bit higher than they are accustomed to spending, and would reduce their disposable income. They've been shot down in most cases, as the statute requires "actual expenditures".

This case, however, goes the other way in that they have a Schedule J expense which far exceeds the standards and the statutory provisions, as well as ample case law, which allows the deduction of those actual reasonable and necessary expenditures.

Sometimes you win, sometimes you lose.