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Trustee recommendations - changing withholdings

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    Trustee recommendations - changing withholdings

    So I made a previous post about the cram down of our car loans being a headache... Well, the trustee also sent a letter stating that the past two years we have received large tax refunds, and therefore, we need to change our withholdings, and increase our payment because we'll have more disposable income. Here's my question... we actually qualified for a 7 based on the means test (were negative) but opted for a 13 because we wanted to keep the house and were behind on the mortgage, AND because we were able to cram down our car loans. So, hypothetical...

    We were -200 a month on our means test

    Increasing our withholdings so we don't get a large tax refund gives us an extra 300 a month

    Would our payments go up that entire $300 of "extra disposible income" or only an extra $100 (since if we had increased our withholdings before filing, those expenses that make up the $200 would have been included and our determined payment would have been 100 more than it is now)?

    Did I explain that correctly? I have a message into the atty to find out but thought in the meantime I'd see what you guys think...

    Thanks!!

    #2
    Anytime I have the trustee demand the income withholdings to change, I then make sure I file a new I and J, that remarkably eats up the additional income. So the net change is $0. So in short, you are correct in that if you increase income $300 and you have $200 more in expenses that you can add to your J, then the net difference is $100 to the blood sucking, puppy hating, non-drinking, probable adulterer, Trustee.

    Good Luck
    Disclaimer: I am not an actor on TV, but I play a BK Paralegal in real life. Nothing I say should be construed as legal advice, or really anything but entertainment. Please seek out professional help.

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      #3
      But would I have to file a new I and J or would the previous one that was filed (which had me negative) suffice?

      Thanks!!!

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        #4
        Don't really see the difference. If you overpay your taxes but get a large refund you're paying the govt. more up front. If you pay less taxes up front trustees/creditors steal it.

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          #5
          "If you pay less taxes up front trustees/creditors steal it."

          That is exactly why the trustee sent becky20 a letter telling her to change her withholding! Trustee wants the $$$
          Filed CH 7 9/30/2008
          Discharged Jan 5, 2009! Closed Jan 18, 2009

          I am not an attorney. None of my advice is legal advice in any way..

          Comment

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