Budget vs. Income

[BrokenBrklyn]

Hey-
I just got my 2nd financial statement done (I'm self employed) and wanted to see what you guys think. I'm still pretty concerned.

Last time I had my income statement done, my lawyer said my income was too high compare to my budget.. a budget I felt was inaccurate that hasn't been changed yet.

Here is where I am now-

Total Income over 6 months: 10,416.00 (previously, this amount was closer to 16,000)
Monthly average: 1736.00

*However, out of this amount, I made a tax payment of 1846.00, if that is deducted, that brings my monthly average down to 1428.00

The lawyer had a budget for me I wasn't comfortable with. This is what I'm more comfortable with in regards to what I actually pay for things (at the low end):

Rent- 792.00; electric and gas 60.00-65; food 175-200.00; insurance 26.00; public transport 40.00-50.00; household (cleaning, pet etc) 40-55; clothing 40-50; grooming 40-60; laundry 60-55; Therapist 190.

At the low end this budget puts me at my 1428.00 average or a little over..

At the high end of this this leaves me with 193.00 left over every month (I wish I knew where it went to).


I also owe about 5000.00 in estimated taxes. I don't have the money now to pay them, but I also have to start paying the IRS something.


March and April which aren't included on my income statement, I had a fairly high income so some of that money may have been carried over into this period some how... so I'm very concerned that the math just isn't going to make sense. Will I be ok if I have an extra 193.00, even though I owe 5000.00 in taxes? Can I include this in my budget even though I don't have a formal payment plan with the IRS since I don't think I can get one until I file my return.

Help Please!

[backtoschool]

Hey-
I just got my 2nd financial statement done (I'm self employed) and wanted to see what you guys think. I'm still pretty concerned.

Last time I had my income statement done, my lawyer said my income was too high compare to my budget.. a budget I felt was inaccurate that hasn't been changed yet.

Here is where I am now-

Total Income over 6 months: 10,416.00 (previously, this amount was closer to 16,000)
Monthly average: 1736.00

*However, out of this amount, I made a tax payment of 1846.00, if that is deducted, that brings my monthly average down to 1428.00

The lawyer had a budget for me I wasn't comfortable with. This is what I'm more comfortable with in regards to what I actually pay for things (at the low end):

Rent- 792.00; electric and gas 60.00-65; food 175-200.00; insurance 26.00; public transport 40.00-50.00; household (cleaning, pet etc) 40-55; clothing 40-50; grooming 40-60; laundry 60-55; Therapist 190.

At the low end this budget puts me at my 1428.00 average or a little over..

At the high end of this this leaves me with 193.00 left over every month (I wish I knew where it went to).


I also owe about 5000.00 in estimated taxes. I don't have the money now to pay them, but I also have to start paying the IRS something.


March and April which aren't included on my income statement, I had a fairly high income so some of that money may have been carried over into this period some how... so I'm very concerned that the math just isn't going to make sense. Will I be ok if I have an extra 193.00, even though I owe 5000.00 in taxes? Can I include this in my budget even though I don't have a formal payment plan with the IRS since I don't think I can get one until I file my return.

Help Please!

$193 left over each month in nyc will put you into a chapter 13.

Your food expenses seem really low for nyc. Can you raise those a bit? I think $300 a month is more realistic. Also, what about cell phone, cable, renter's insurance, medical insurance? I want to see that $193 down to under a $100 if possible. (nyc is more aggressive about putting people into chap 13 so I want to see you as low as possible on your monthly money left over).

[BrokenBrklyn]

well, it depends on if the attorney can/wants to deduct the 1846.00 I paid on taxes in this period.

I can def. come up on food I think inbetween everything I can probably come up to 300.00 a month. My cellphone/cable I deduct.. and I don't have health insurance although I do occasionally have to go to the doctor and pay for prescriptions.

Could I average that out over the course of a year?

Also what about my current tax liability for 2009, anything extra I do have, has to go toward that.. even though it's estimated taxes, can I include that in my budget?

[BrokenBrklyn]

Ok, so if I add in approximately 30.00 a month which covers an average of 3-4 office visits for me per year, and go up to 300.00 in food (which seems more accurate considering I do have a special diet and I spend at least 200.00 in groceries alone at the grocery store every month. Not including trips for little things), and 55 in household and 55 in laundry... it leaves me with something like 53.00 extra each month..

[backtoschool]

Ok, so if I add in approximately 30.00 a month which covers an average of 3-4 office visits for me per year, and go up to 300.00 in food (which seems more accurate considering I do have a special diet and I spend at least 200.00 in groceries alone at the grocery store every month. Not including trips for little things), and 55 in household and 55 in laundry... it leaves me with something like 53.00 extra each month..

That is MUCH better, and will keep you out of a chapter 13, at least as far as the means test goes.

[BrokenBrklyn]

I didn't see anything about disposable income in the means test section of the law..

Either way I have like 50,000.00 in debt and with what I do actually make, there's no way I'd ever be able to pay back my creditors over 3-5 years anyway..

And besides, I'm now in the hole again with the IRS.

Good times.

[BrokenBrklyn]

One more question- I paid taxes in the last six months. And I have estimated tax payments that I can't pay for all at once, can i include a monthly payment for the previous taxes in my budget...

For example; for a tax payment of 1800.00 made in may, can i average that over the 6 months, and take that as an item in my budget?

I'm very confused. Obviously, income is the income over the past 6 months but is the budget for that time period as well, or is this a budget going forward?

[nerves]

The budget is for the time going forward. Someone else may be able to answer the tax question. Gurus - can you please assist?

[Llelxon]

On my expense listing for filing I had $500+ left over and my attorney didn't see it as an issue... My argument is that he told me to list what I am actually spending every month and no unsecured debt payments. If I was spending the proper amount on food, clothes, home repairs etc. I wouldn't be going backwards every month and continually assuming more debt. So my argument is my current actual expenses are inaccurate and will be until after I am done and get a realistic budget.