Honest Abe divulged $40 k bonus & Trustee used income older 6m to calculate Ch 13 pmt

[igetit]

Husband did not answer question asked him by Trustee re: pre- Ch 13 filing Sales bonus inc ques & divulged a $40k bonus he earned post filing but pre-341 mtg...all said & done we had to write a ck for $25k to go into the plan...can trustee do that?

Can we file "incompetent atty" against our atty for not advising us to let plan dismiss & pay this sum against $55k stdnt loans & refile (our atty seemed more on the side of the courts than w/ us...what gives?) He just said "thne rooster has come home to roost..."

We told our atty we wanted to file quick b/c we knew this bonus was coming & we wanted the 341 mtg to be over prior to receiving the $40k...he dragged his feet, chgd us $5k for fiing & post confirmation atty services would cost additional

HELP

[despritfreya]

Not quite sure what you are asking. It sounds like your husband was entitled to a substantial bonus as of the filing date. If so, the bonus is a "receivable" and is an asset of the estate. You must account for it to your creditors, less any exemption you can claim regardless of when your 341 is/was. Further, in a Chapter 13, after acquired assets are also property of the estate.

If you knew you had this $$ coming to you and you wanted to keep it you probably should not have filed at all until after you had received, cashed and spent the $$. But if you did not wait a full 6 months after recieving the bonus, those funds would have been included in your 6 month average and may have had other consequences that you would be dealing with.

In most jurisdictions you have the absolute right to dismiss a Chapter 13. If the case is not confirmed, funds held by the Trustee (less his fee, any already paid adequate protection payments and maybe allowed attny fees) will be returned to you after dismissal. However, before you seek to dismiss you need to determine what consequences a dismissal may have such as the loss of a home or car or the reviving of a garnishment.

If you believe your attny gave you bad advice seek a consultation with another one.

[olivies]

But if you did not wait a full 6 months after recieving the bonus, those funds would have been included in your 6 month average and may have had other consequences that you would be dealing with.

I'm curious how much the USSC Lanning decision will affect people who receive one time bonuses and cash influxes like this. It seems logical that a past one time non-guaranteed income bonus should not be used to calculate future projected ability to pay.

[despritfreya]

In response to:

"I'm curious how much the USSC Lanning decision will affect people who receive one time bonuses and cash influxes like this."

Yes, it will impact cases going forward. In my particular jurisdiction at least 1 Trustee has required language in the Order Confirming requiring the turnover of future bonuses.

[momofthree]

Is this post some sort of glitch? According to past posts, OP filed bk in 2008 and forked over the $25k shortly after. That money is long gone.....

[despritfreya]

In response to:

"Is this post some sort of glitch? According to past posts, OP filed bk in 2008 and forked over the $25k shortly after."

I am going to venture a guess as to what happened as OP was not too articulate as to the details. The OP also stated "...all said & done we had to write a ck for $25k to go into the plan" so here is what I think may have happened.

-OP files bk in 2008
-As of the filing date OP was owed a substantial bonus
-OP did not list the bonus on Schedule B as a receivable or wages owed (asset)
-OP collects bonus
-Trustee finds out about the receivable/wages owed. Maybe there is a partial exemption for wages therefore only $25,000.00 has to be accounted for.
-Trustee demands that Plan funding be increased by $25,000.00 to meet Chapter 7 Reconciliation.

In essence I doubt OP wrote a $25,000.00 check directly to the Trustee (unless at the point where the Trustee discovered the asset OP still had some funds available). My guess is that OP's Plan payment increased to account for the asset. Since the post has come out now I will also venture a guess that the Plan has only just been Confirmed. I could be totally wrong but this analysis would account for the time discrepancy.

I guess we will have to wait for clarification from the OP.