How Can You Know FOR SURE if Unemployment is Counted on the Means Test?

[gman]

There have been many posts on this forum - and the consensus is that is depends on your district. Some count this as income and others 'exempt' it as a Social Security benefit.

I did what you are supposed to do: Ask a bunch of lawyers how it is handled in my district.

Guess what?

Half of them have told me that it does and half have said it does not.

Not a single lawyer pointed to a case where a judge rendered a decision.

I actually found a case in my district where it was counted, but for funding a Chapter 13 plan - not for passing the Means Test for a Chapter 7.

If it is included in my Means Test, I do not pass [until Nov 1] as I am currently unemployed and have been since early July.

If it is not included, I pass my Means Test on Oct 1.

SO BESIDES CONTACTING OTHER LAWYERS SHOULD I CONTACT THE UST OFFICE [ANONYMOUSLY]?

SHOULD I CONTACT THE COURTHOUSE [AGAIN ANONYMOUSLY]?

Question: How can I find the real answer before I file???

========================

Bonus question: I could stop taking unemployment for the next 2 weeks and that "loss in income" could help me qualify for the Means Test. Would you do this? What is the downside?

[AngelinaCat]

I am not sure my comment will actually answer your question, but I will present it, for what it is worth.

We started trying for a Ch13 in August 2006. For reasons of a stipend from a Trust (retirement) that is paid to us annually in January of each year, we had to wait until after July 2007 before we could think of filing. At that time, I was employed with both a FT and PT job(s). 'Hub is retired, for all intents and purposes, but has a computer consulting business on an irregular basis. When we went to the pre-filing credit counseling session, the lady ran our income vs outgo, and advised that we were better suited for a Ch7, rather than a Ch13.

That was in July. Later, I was notified that as of September 30, I would no longer be employed with my FT job, due to 'budget cuts'. I started drawing Unemployment Compensation on October 7, 2007. The loss of the FT job is what really propelled us into the Ch7.

At each and every point of this time-line, when something happened--including when our attorney got a new helper--we had to submit a new set of pay statements, advices, and 1099s for them to run the Means test. We submitted about four or five different sets. We asked each time, what this meant? To which we were told, "you are fine, don't worry about it." We never could get a more definitive answer than that. We also did not know of this forum at the time; if we had, we would have nailed her down. She and her new assistant became very uncommunicative.

At our 341, the trustee did ask: "Who gets the stipend from the Trust?"

"We both do."

"Who gets the Unemployment?"

"I do."

And that was that. This exchange suggest to me that Unemployment Compensation is exempt--at least in Florida Middle District courts.

Good luck to you.

[tobee43]

gman...we found ourselves in the exact same situation. we were uncertain about our atty...because he insisted it was not counted....i was just like you...saw another atty who stated for certain it WAS....what do you do???

so what we did was two fold....remember the expenses ...they were up...but within the guidelines...the UI in our district ended up NOT being counted as our first atty advised us.

now to find out for certain i think you can do this my Internet look up...i was able to check out my means test after you and i went over my actual paperwork and it was online.........(my district, i mean).

and of course...my paperwork will really not help you. but all the amounts we put down we were able to back up with statments...bills...actual payments. so there could be no questions.

i know this is hard, but if you can't locate your district's info on line...i would call...each atty has a different answer for the same question...it gets to the point of insanity. don't do it to yourself.

[AngelinaCat]

Bonus question: I could stop taking unemployment for the next 2 weeks and that "loss in income" could help me qualify for the Means Test. Would you do this? What is the downside?

I advise against doing this. You have already 'lost your income' by losing your FT job. The UC benefits will not last forever. And you cannot count on UC as income. Congress could take it away at any time.

However, you can 'stage' your benefits if it helps your budgeting. I learned not to claim both weeks when the time comes to do so, as when we saw the relatively large amount there, we tended to go 'nuts.' Instead, claim one week on the day you should, then a few days later, claim the other week. That weill help you out until you cam find something.

Good luck to you in this economy. I hope the above posts have helped a little.

[AngelinaCat]

Actually on thinking a little further about your Bonus Question, you deciding to not take it for a week or two won't help you anyway. Because you have to declare what benefit amount you are eligible for. Our attorney wanted an itemized statement of what I was entitled to, and how much I was paid each week. She was not happy with the summary of my account, as posted online. But she had to be as that was all I could get, along with the bank statements from our CU, with my UC benefit highlighted in yellow.

[gman]

Update:

A lawyer with a "bankruptcy mill" type of firm today told me that unemployment benefits are counted by the local judges in my district. He specifically said an email blast went to all attorneys in his firm with a heads up on this issue.

He was the first lawyer to not simply state his "opinion" and backed it up with a fact.

Seems like you have to kiss a lot of frog lawyers until you get one that knows for certain how the local districts do business.

[tobee43]

Seems like you have to kiss a lot of frog lawyers until you get one that knows for certain how the local districts do business.

yeah...frogs...too bad they usually don't turn into nice princes or princess who take you into the sunset happily ever after!

so what's the "final" concenus...you going with this one??

[gman]

so what's the "final" concenus...you going with this one??

I am either going with him OR pro se.

Learned today that I can include my Flexible Spending Account payments as an expense (via this forum....not from him or any other lawyer.)

This means I will be slightly negative (pass!) on the Means Test on Oct 1 - even if I include unemployment income.

Regardless of who I go with - I am leaning toward expensing out even more - so if a UST gets an inkling to still move to deny my case, he/she will have a bunch of expenses to blow through first. All are legitimate.

Examples:
* Actual transportation expenses (gas, oil changes, insurance) vs. actual
* Telecom to include cell phone for 2 ($80) and internet ($55)
* Extra 5% for clothing/food
* $20/week church offering
--- I have receipts to back up all of this except church because I put cash in the offering plate weekly.

Adding these puts me at a negative $200 of DMI on Oct 1 for the Means Test. Assuming the UST wanted to object, he/she would have to dispute close to $290/mo of expenses to make me fail the Means Test. I figure the UST will not bother - especially given my Schedule J being over $4,000 negative projected disposable income.

I think this lawyer was right: My whole case rests on my employment or lack thereof on the day of my 341.

[JoePlumber]

In California my unemployment income was counted as part of our means test and I had to wait to file until much of my income for my past 6 mos income was All unemployment due to my earnings prior, yet all worked out... I would say it all depends on your state and if you have other household income.

[tobee43]

g...NOW you got it....there was NO fighting the expenses with the back-up...i was attempting to say without saying...it loud and clear...

whether related to work or med expenses...just do it as long as you have back up you are good to go. i left no stone unturned....i had every piece of paperwork to back us up...and we were good to go!

[Dee]

I am not sure my comment will actually answer your question, but I will present it, for what it is worth.


And that was that. This exchange suggest to me that Unemployment Compensation is exempt--at least in Florida Middle District courts.

WHEW!!! I've been trying to find an answer to this for Middle District Florida. We can pass the Means Test and have a negative of over $700 DMI on our actual expenses if we don't have to count my husband's unemployment. Now I just have to figure out how to get our actual expenses into a managable range before his unemployment runs out.

[Pandora]

* $20/week church offering
--- I have receipts to back up all of this except church because I put cash in the offering plate weekly.

Dont know about your district, however in mine (and in many) any tithing/charities/etc claimed must be backed up by either the church issuing you a form, or on your tax returns, as it stands you cannot claim over XX amount on tax returns without the proper documentation per IRS guidelines. (think its anything over $250). So be prepared for the possibility to be able to back up that $1040 yearly expense.

[gman]

I am either going with him OR pro se.

Learned today that I can include my Flexible Spending Account payments as an expense (via this forum....not from him or any other lawyer.)

This means I will be slightly negative (pass!) on the Means Test on Oct 1 - even if I include unemployment income.

Regardless of who I go with - I am leaning toward expensing out even more - so if a UST gets an inkling to still move to deny my case, he/she will have a bunch of expenses to blow through first. All are legitimate.

Examples:
* Actual transportation expenses (gas, oil changes, insurance) vs. actual
* Telecom to include cell phone for 2 ($80) and internet ($55)
* Extra 5% for clothing/food
* $20/week church offering
--- I have receipts to back up all of this except church because I put cash in the offering plate weekly.

Adding these puts me at a negative $200 of DMI on Oct 1 for the Means Test. Assuming the UST wanted to object, he/she would have to dispute close to $290/mo of expenses to make me fail the Means Test. I figure the UST will not bother - especially given my Schedule J being over $4,000 negative projected disposable income.

I think this lawyer was right: My whole case rests on my employment or lack thereof on the day of my 341.

I am currently going to file with around $400 of wiggle room to pass the Means Test. All expenses (except church) are backed by receipts. Church is backed up by prior tax returns.

[tobee43]

Dont know about your district, however in mine (and in many) any tithing/charities/etc claimed must be backed up by either the church issuing you a form, or on your tax returns, as it stands you cannot claim over XX amount on tax returns without the proper documentation per IRS guidelines. (think its anything over $250). So be prepared for the possibility to be able to back up that $1040 yearly expense.

this is EXACTLY correct!! we had a HUGE contribution this past year....lucky for us our contribution actually went to a STATE.....so as a donation the STATE itself issued a receipt that we supplied to the court since we knew it was going to seem very odd that we donated such a large amount....and believe we had to have it!!


in my experience.. in as much as the "church" if you go over $250 at one time, that is when you need to prove what you donated. not when you pass the hat weekly and drop in a 10.oo weekly .....even tho you have done it every week of the entire year and the total adds up to 520 dollars ...it's fine, providing you didn't give the 520 at one time...then you need to provide the receipts.

even when you throw items in the salvation army or vet "bins" you should keep tract of what your giving up...although it is valued only as "thrift" store value when it comes time to tax deduct it. (when possible get the receipt, however, i have found most salvation armies give you a BLANK and you have to fill it out and they will sign it for you).

[Fallonedward]

Tobee, you always have the best advice

this is EXACTLY correct!! we had a HUGE contribution this past year....lucky for us our contribution actually went to a STATE.....so as a donation the STATE itself issued a receipt that we supplied to the court since we knew it was going to seem very odd that we donated such a large amount....and believe we had to have it!!


in my experience.. in as much as the "church" if you go over $250 at one time, that is when you need to prove what you donated. not when you pass the hat weekly and drop in a 10.oo weekly .....even tho you have done it every week of the entire year and the total adds up to 520 dollars ...it's fine, providing you didn't give the 520 at one time...then you need to provide the receipts.

even when you throw items in the salvation army or vet "bins" you should keep tract of what your giving up...although it is valued only as "thrift" store value when it comes time to tax deduct it. (when possible get the receipt, however, i have found most salvation armies give you a BLANK and you have to fill it out and they will sign it for you).