Yearly tax returns in 100% Chapter 13

[womanonfire]

Does the trustee get a copy of all tax returns filed the whole time I'm in the plan?

[shipo]

I think it depends upon the Trustee; in my case they got all five tax returns plus another $1,200 or so from one of my refunds.

This is most likely a question for your attorney.

[womanonfire]

I think it depends upon the Trustee; in my case they got all five tax returns plus another $1,200 or so from one of my refunds.

This is most likely a question for your attorney.

My attorney told me that I was going to be able to keep my refunds since I am already in a 100% plan which I question since I owe the IRS and they are being paid through the plan. I've never known them to give you money back when you owe them but this is my first bk rodeo.

Also you ask questions here first, then stew on it, research it, research it some more before you pay $350 an hour to ask your attorney lols.

[shipo]

My attorney told me that I was going to be able to keep my refunds since I am already in a 100% plan which I question since I owe the IRS and they are being paid through the plan. I've never known them to give you money back when you owe them but this is my first bk rodeo.

Also you ask questions here first, then stew on it, research it, research it some more before you pay $350 an hour to ask your attorney lols.

Two comments:

1. Since every Trustee is different, there is no way any of us can give you a solid answer unless one of us happens to have had the same Trustee as you.
2. Once my Chapter 13 was filed, all questions and research my attorney needed to put into for my case were billed back to the Trustee who paid them from the money I paid into the plan.

[womanonfire]

Two comments:

1. Since every Trustee is different, there is no way any of us can give you a solid answer unless one of us happens to have had the same Trustee as you.
   
   I'll take "in general" answers.
2. Once my Chapter 13 was filed, all questions and research my attorney needed to put into for my case were billed back to the Trustee who paid them from the money I paid into the plan.

I do not want to pay any more money than I have to. Thanks for your feedback!

[justbroke]

My attorney told me that I was going to be able to keep my refunds since I am already in a 100% plan which I question since I owe the IRS and they are being paid through the plan. I've never known them to give you money back when you owe them but this is my first bk rodeo.

I owed the IRS about $35,000 during my Chapter 13. They were in the plan and yet gave me a refund each year that my return indicated as much. It's too much paperwork for them to try to claw at the tax refund since they can't apply it to anything "included in the plan" as that would be a violation. Technically they could file a motion to take the refund, but I have never experienced the IRS doing so... even when I owed them $35K.

[womanonfire]

I owed the IRS about $35,000 during my Chapter 13. They were in the plan and yet gave me a refund each year that my return indicated as much. It's too much paperwork for them to try to claw at the tax refund since they can't apply it to anything "included in the plan" as that would be a violation. Technically they could file a motion to take the refund, but I have never experienced the IRS doing so... even when I owed them $35K.

Good to know! Looks like we owe now that my husband got a new job and is 1099. He is now paying quarterly taxes so maybe next year will be different.

[shipo]

I do not want to pay any more money than I have to. Thanks for your feedback!

The point I was trying to make is I didn't pay anything extra, the Trustee paid it out of the plan and my payment never changed.

[womanonfire]

The point I was trying to make is I didn't pay anything extra, the Trustee paid it out of the plan and my payment never changed.

How can your attorney charge you more for these things and you not have to pay extra? Maybe I am being dense, wouldn't be the first time and it certainly won't be the last!

[shipo]

How? I don't know, but that's how it worked for me; my plan had a fixed monthly contribution to the Trustee, and any time my attorney needed to do something, she billed the Trustee and he paid it. The only time I paid her anything was before I filed.

[Clay3007]

Every time i call my attorney's office i always talk to the paralegal that answers the phone. Honestly the last time i spoke to our actual attorney was the 341 meeting and that was almost 3 years ago. Never been charged a dime more then the $4000 the courts allowed.

[womanonfire]

Every time i call my attorney's office i always talk to the paralegal that answers the phone. Honestly the last time i spoke to our actual attorney was the 341 meeting and that was almost 3 years ago. Never been charged a dime more then the $4000 the courts allowed.

I paid twice as much as you did because my case is complicated.

Anyway, I answered my own question by going to the Trustee's website and looking at debtor's handbook that hasn't been updated since 2015. Yes I have send her a copy of the return every year and I guess it makes sense so they can look for a substantial change in circumstances.

[justbroke]

Anyway, I answered my own question by going to the Trustee's website and looking at debtor's handbook that hasn't been updated since 2015. Yes I have send her a copy of the return every year and I guess it makes sense so they can look for a substantial change in circumstances.

In a 100% plan, a change in finances should not impact the plan at all. Unless, there is a loss of income dropping the person out of a 100% plan. If a 100% plan was mandatory (required by the Chapter 7 liquidation test), this will cause major issues.

Despite what some Chapter 13 Trustees and attorneys will say, a 100% plan only requires you to pay 100% and not your disposable monthly income (DMI). So, even if your DMI increased 10-fold, there is no reason to modify the plan. Of course one could choose to voluntarily pay more each month and even earlier.

I think that sending a copy of the return is just a standard for Chapter 13s.

Whether or not a Chapter 13 attorney will charge you for services after confirmation, it depends on what's included in (the district's) no-look fee or what's in your fee agreement. Generally, major things which require a hearing may cause the attorney to charge a fee.

[womanonfire]

In a 100% plan, a change in finances should not impact the plan at all. Unless, there is a loss of income dropping the person out of a 100% plan. If a 100% plan was mandatory (required by the Chapter 7 liquidation test), this will cause major issues.

Despite what some Chapter 13 Trustees and attorneys will say, a 100% plan only requires you to pay 100% and not your disposable monthly income (DMI). So, even if your DMI increased 10-fold, there is no reason to modify the plan. Of course one could choose to voluntarily pay more each month and even earlier.

I think that sending a copy of the return is just a standard for Chapter 13s.

Whether or not a Chapter 13 attorney will charge you for services after confirmation, it depends on what's included in (the district's) no-look fee or what's in your fee agreement. Generally, major things which require a hearing may cause the attorney to charge a fee.

I was going to update my case but the Trustee filed a MTD and one of them was bad faith due to not paying 100% of my DMI. Looks like this same Trustee lost on a previous motion with another debtor over the same thing.

Other issues the Trustee mentioned:

IRS says I didn't file my 2020 tax return but they sure as hell cashed the check that was included with my tax return. Mailed again with tracking plus letter and copy of cancelled check. Called and on hold for two hours and disconnected. Called the IRS bk contact and she said not to worry about it. Who knows.

Wants 2021 return. Don't I have until April to file? I will not get all my forms from various places until Feb....

Attorney filed wrong number of dependents and and said no to transfer of property which he knew was incorrect and which is turning out to be complicated so I had to admit they were wrong at 341 meeting. He waited literally on the last day to get this done and I was trying to review everything at work at the last minute and I had made sure that he had all corrections filed for two weeks in advance. I finally got pissed because they couldn't get it right and literally said "f**k it." I was so frustrated that day it was unbelievable!

[justbroke]

I was going to update my case but the Trustee filed a MTD and one of them was bad faith due to not paying 100% of my DMI. Looks like this same Trustee lost on a previous motion with another debtor over the same thing.

I'm glad they lost because there is nothing in the bankruptcy code requiring DMI for a 100% plan. In fact the code reads... "the [money] to be distributed under the plan on account of such claim is not less than the amount of such claim" which translates that all claims must be paid in full. It then has an "or" which reads that the plan provides that the debtor's (projected) DMI is applied to the unsecured creditor claims.

I don't know why the Chapter 13s Trustees gripe over this in a 100% plan. The code doesn't require it, otherwise they would not have added the paragraph that you could pay the value of the (unsecured) claims. Makes 0 sense to me, but I see that this issue with Chapter 13 Trustees does often happen.

Other issues the Trustee mentioned:

IRS says I didn't file my 2020 tax return but they sure as hell cashed the check that was included with my tax return. Mailed again with tracking plus letter and copy of cancelled check. Called and on hold for two hours and disconnected. Called the IRS bk contact and she said not to worry about it. Who knows.

I just read an article the other day that says that the IRS is still backlogged with millions of tax returns including some from tax year 2019 (filed in 2020)!

Wants 2021 return. Don't I have until April to file? I will not get all my forms from various places until Feb....

Yes, you just give that when it's filed in April.

Attorney filed wrong number of dependents and and said no to transfer of property which he knew was incorrect and which is turning out to be complicated so I had to admit they were wrong at 341 meeting. He waited literally on the last day to get this done and I was trying to review everything at work at the last minute and I had made sure that he had all corrections filed for two weeks in advance. I finally got pissed because they couldn't get it right and literally said "f**k it." I was so frustrated that day it was unbelievable!

The number of mistakes that are made seem to be par for the course. There is almost always something that is off, or a correction not done.

Here's the thing with Chapter 13s... from day 1, just make your payments. The rest is administrative and trying to keep up with the paper will just give you a massive headache. So long as your payment doesn't materially change, you just keep your head down and make the payments. As I mentioned in another thread, confirmation can easily take 6-12 months with the average being closer to 12 months and some cases taking 18 months to confirm. So long as nothing materially changes, there's no foul in the confirmation taking a long time.