Schedule J confusion

[rjmwx81]

That's where the water gets muddy, so to speak. I've seen people say they've listed student loans on Schedule J without any problem; others have said their trustee objected. So it sounds like one of those district/trustee specific things, so if the trustee objects to your including it on the Schedule it really doesn't matter what amount you list, since it won't be allowed anyway.

Are you able to show a negative or very small DMI on your Schedule J without listing the student loans, when you include all your other expenses?


I really can't tell you why student loans are treated differently on Schedule J than other non-dischargeable debts, I just know that, in many districts, they are.

[justbroke]

When a person is under-the-median income, the student loans usually don't matter. So their inclusion on Schedule J is usually moot. The only time there is a collateral attack on them, is usually when you're over-the-median, and the exclusion of the student loans, under the hypothetical Chapter 13 analysis shows that you can pay "some" dividend to unsecured creditors in a Chapter 13.

It would be like the UST arguing with a debtor with a DMI of $-1000 over a $100 cable bill. It's moot. However, if the debtor was at $100 DMI, then the $100 can be the difference between Chapter 7 and Chapter 13/11.

[HED]

Not exactly sure of what you mean by 'short-changing' myself. I THINK you mean what is explained at this link:
bankruptcylawnetwork[DOT]com/2008/05/29/the-two-schedule-js-how-they-should-differ-in-chapter-7-and-13/

The strategy for ch 7 would be to show more expenses than income. Whereas the strategy for ch 13 would be to show more income than expenses. With only SS as income, and my expenses being more than my income, I should be ok for a discharge.

[HED]

I am well below the median income. If I omit the student loans from sched J, I have $20 left over. But if I include the loans, I am in the hole -$197. I filed a chapter 7 in 2000 (in Indiana) and my attorney included the student loan (only had one back then). But that was a different scenario back then as I wasn't in default on it and I fully intended to continue the payments without interuption. This time I'm filing from Arkansas.

[justbroke]

The strategy for ch 7 would be to show more expenses than income. Whereas the strategy for ch 13 would be to show more income than expenses. With only SS as income, and my expenses being more than my income, I should be ok for a discharge.

For a Chapter 13, that is not true. For a Chapter 13, is to show that you can afford to be in plan, but you don't want to have too much excess disposable monthly income (DMI), as that would just put you in a 100% plan. The Chapter 13 Schedule J is a balancing act and is a much more orchestrated piece of work. If you plan your Chapter 13 correctly, you should have little DMI left. In my case, I had a "true" negative DMI of $-450/month (based on the means test). Schedule J was $54 in DMI. That is where you want to be. Don't leave anything on the table.

I agree that for Chapter 7s, you want to exhaust all expenses and show as close to $0 in DMI as possible. However, the downside is that the expenses must be allowable and actual.

[HED]

I think my only questionable expense would be DirecTV at $147. Cable would be 30-50% cheaper but it is not available in my remote area. And they could argue that I could get a cheaper package but I have several legit reasons for requiring the package that I do.

[justbroke]

[QUOTE=HED;461337And they could argue that I could get a cheaper package but I have several legit reasons for requiring the package that I do.[/QUOTE]If it produces income, or aids you in the production of income, then that is always an affirmative defense. I listed my cellular phone bill as $150 on my petition because it is income producing! I need contact with my customers (data services). Additionally I included a similar amount for internet service. Necessary for production of income.

[HED]

Well, I need a cell phone due to my disability to be able to call for assistance if my car breaks down, flat tire, anything like that. And I have a data plan on it. Total cell bill is $81. But I did away with my land line. My cell with data is far cheaper than a cell with no data + a landline + dialup internet. I use the internet for legal issues, contacting SS, etc. It's surely a hassle looking up legal info as well as typing this post, but I'm doing what I can to keep expenses low. DTV expense is not income producing either but it has a absolute value for reasons too lengthy and tedious to describe here from my phone.

[justbroke]

No need to describe. I think your reasons for your expenses are perfectly valid! An acceptable reason is always for the health and safety of you and your dependents, so that is a good thing!

[HED]

I think so. Hope they see it the same way. Especially during the AP! Did you say you did an AP for student loans?

[justbroke]

I think so. Hope they see it the same way. Especially during the AP! Did you say you did an AP for student loans?

No, my complaint (AP) was on an egregious violation of the automatic stay. Not only did they default by not answering, they settled with me.