charitable contribution question

[gina2000]

I had posted this to the property transfer forum but will post my question here also:

I plan on filing ch7 in July or August; it should be a fairly straight forward no-asset case with unsecured debt only. The statement of financial affairs requires the disclosure of any charitable contributions greater than $100 per recipient made within one year preceding the filing. In December I made a $1000 contribution by check to a small non-profit organization. Is this something that the bankruptcy trustee may want to recover? I don't want any contact being made with the non-profit if it can be avoided. Thanks for any help!

[tobee43]

no, and i believe i answered this to your other thread, however, maybe someone else may be able to shed a brighter light for you. trustees usually have no interest in going after a church or whatever. they just want to insure it's legitimacy, the receipt should be enough. it's difficult to know exactly what they want.

[AngelinaCat]

If you are planning to file in July or August, you should be okay regarding this donation. $1000.00 is not a large sum in SOME situations.

However I suggest delaying filing as long as you possibly can. The more time you can put between this donation, and your filing the better off you will be. You will be asked for the past six months of pay-stubs/bank statements. Also you probably will be asked for the past two years of income tax returns.

[gina2000]

Thank you for the responses. Sorry, I'm still pretty unfamiliar with all of this. If I go longer than 90 days without paying the credit card companies, am I at risk of judgements or the like?

[AngelinaCat]

Yes you are, but you have time. You will get many telephone calls at first. Then after that, you will get paper notices by snailmail. Then after that, you will get an official notice by snailmail, most likely, that a suit has been filed against you. You will have 20-30 days to respond, depending on your district.

Do NOT panic. This is normal behavior and protocol. Keep us informed and we can let you know what the next step to take should be.

[tobee43]

you would need to be served and you can go to court and it will delay the entire situation. i know it's difficult to deal with all these

even if the creditor did obtain a judgement, after you receive you're discharge you would file a motion to vacate the judgement.

[gina2000]

All these mentions of the "j" word are scary. Getting back to the $1000 cash donation - if the BT were to seek recovery, can it be negotiated? Perhaps by reducing my wildcard exemption by an equal amount? FYI, I'm in the eastern District of California.

[keepmine]

You're stressing over nothing. From 548 of the bk code:

course of business.

(2) A transfer of a charitable contribution to a qualified religious or charitable entity or organization shall not be considered to be a transfer covered under paragraph (1)(B) in any case in which--

(A) the amount of that contribution does not exceed 15 percent of the gross annual income of the debtor for the year in which the transfer of the contribution is made; or

(B) the contribution made by a debtor exceeded the percentage amount of gross annual income specified in subparagraph (A), if the transfer was consistent with the practices of the debtor in making charitable contributions.

[tobee43]

agreed keepmine. also, is there some type of problem with the contribution?

we have always tithe 10% of our income, no ifs ands or butts...we have a 40 plus years of filing taxes with charitable contributions. so it's not unusual. actually, what was more unusual in our personal situation, was we had far more items to contribute ( due to moving out of our home of 30 years and not enough time to sell items.

[keepmine]

There's no problem with the contribution. It not considered a fraudulent transfer if it's less than 15% of the gross income or,part of a consistent practice of charitable giving.

[tobee43]

oh...lol, sorry, you misunderstood, or i wasn't clear. actually the "rule of thumb" is 10% from what i have advised and always followed. but just as inflation i guess that percentage may well have gone up.

i was just referring to the OP being so concerned over this particular contribution, if they or the OP was concerned there is any fraud or can be viewed that way. sorry, i wasn't clear.

[gina2000]

keepmine, thanks so much for your post!! The donation was under 15% of my gross income last year, so I won't stress over it. My concern was due to the fact that the organization is run by a friend, and I would be mortified if my bankruptcy got back to her and if she felt the contribution was somehow jeopardized. This forum is truly an incredible wealth of information - so glad I found it.