Mean test? Vehicle ownership expense

[Depressed]

Met with an attorney last week for a consulation and while we were running the numbers on the means test he said we couldn't claim a vehicle ownership expense(Line 23/24) for a vehicle that was paid off. Is this correct?

My wife and I own two vehicles. One paid off that I have title on, and another that we still are making payments on. He said we could only take the expense for the one we are making a payment on.

[pcn]

It depends where you live. Where are you? In AL you can claim both.

[Depressed]

I'm in Utah.

[secondtimer]

Ownership costs and operating costs are two different things.

http://www.irs.gov/businesses/small/article/0,,id=104623,00.html

http://www.justice.gov/ust/eo/bapcpa/20100315/meanstesting.htm

[pcn]

Not sure if the qualifications for the IRS are the same as what the BK court requires. At least in this area, you are allowed the transportation ownership expense, even if the vehicle has no lien. The vehicle operation expense is calculated based on the number of vehicles claimed, regardless of lien status (max of 2).

[secondtimer]

Wow. That's a substantial number. I don't have a lien on my truck. If I were in your district I could claim both transportation expenses to calculate DMI for a CH13 or does it just apply to the CH7 means test?

Anyone know if this applies to district 3/Delaware?? I'll start a search and post results if I find them.

[pcn]

From what I found it varies by district. You're right, it is a big number. Being able to use it helped us qualify for a ch7 rather than a 13. I am not sure if you can use it when calculating the DMI for a 13. My guess is that there you must use actual expenses. Sorry, I don't know for sure since we didn't have to go that route. We were looking at 13 for the lien stripping capability, but our monthly payment was going to go up so much based on the 2nd payments going away it was better to go ch7 and try to settle with the 2nd. I think posting what you find would be a big help. A sticky showing treatment by district would have been nice when I was researching it.

[Depressed]

Thanks, for the replies. I'm a borderline over the median Ch. 7 case. I was told even a small payment on a second vehicle would push me into a 7.