Trustee Recommendation

[lgeiger99]

I received a notice from the Trustee.

Here's what it says:

The Trustee estimates a $2000.68 shortfall in the funding of Debtor's Plan. The shortfall amount includes a $1,243.16 Chapter 7 reconciliation amount.

I don't understand this. Help!

[justbroke]

The "reconciliation" amount is actually known as the "Chapter 7 liquidation test". This is where, had you filed Chapter 7, the Trustee would have recouped that amount due to non-exempt property.

So, you need to pay the amount or your Chapter 13 case will be dismissed.

By "pay" I mean that you need to insure that your plan is feasible and able to pay that additional amount. If you are in a 60 month plan, and have 50 months left, that means an additional $40/month.

[lgeiger99]

Thanks Justbroke. I called my Trustees office and found out the amount corresponds to deposits I paid prior to my bankruptcy that were not refunded to me. So I need to fill out a Schedule C and exempt the amount (it was less 25%). They were deposits for rent, gas, electric, water and cable.

At least I think I can exempt them. On Schedule C you list them, but you have to site the law. I filed in AZ, but had to use California exemptons.
Now, I'm trying to figure out if I can cite the Homestead exemption or just say over and over _____ is entitled to continued possession of the deposit for each one.

I read that most Trustees don't try to add deposits in, but mine did.

[justbroke]

You must cite the homestead exemption. If you don't have a home, you are entitled to use the "unused homestead exemption". I didn't think that California allowed a non-resident to use the exemptions, but if they do, then you'd probably want to use System II exemptions under the unused homestead exemption. You'd just list the Statute and corresponding paragraph... e.g. F.S. 222.25(4) is the unused homestead exemption in Florida and is what I would have listed in Florida.

I hope you can now see why I can't just tell you which statute! I am not familiar with California bankruptcy law, but most of the States don't allow their exemptions to be used unless you are a resident. This usually means using the Federal Exemption scheme.

[lgeiger99]

AZ rules are you must live in AZ for six months before filing, but to claim AZ exemptions you have to live here for two years - that's why I use CA exemptions.

I have a list of the CA exemptions, but it says nothing about deposits. Can I use the homestead exemption for all the deposits above (rent, cable,
gas, electric, water?). No deposit monies were returned to me.

Thanks for you help, justbroke.