Fiscal Cliff??

[enginegirl]

was just wondering what the Fiscal Cliff will do to our paychecks. I did a quick calculation and I will be bringing home about $200.00 per month less (and for the record I do not earn over $100,000.)... It is hard enough to stay in budget, but now with the thought of this looming.... yikes.... Anyone have any thoughts?

[LadyInTheRed]

Please keep this discussion to how this will effect your budget and your BK. If you can't resist a political comment, please do not post. Political discussion belongs in the sticky provided in the General Talk forum.

Thank you!

[LadyInTheRed]

enginegirl, did your calculation include the end of the temporary break in social security withholding? My understanding is that that is not part of the fiscal cliff.

I'm fortunate that I've had some raises since I filed BK, so that makes it a bit easier for me to absorb tax increases. But, expenses have also increased and I will still need to adjust. I am also fortunate to have about $300 in 401k contributions included in my budget. If I can't make ends meet, I can always temporarily stop those. I'd hate to do that, especially since I wouldn't see a dollar for dollar increase in my paycheck by stopping a tax free contribution.

My guess is that even if the Bush tax cuts for the middle class are not extended before the end of the year, they will be soon in the new year and our pain will be temporary.

[IM2Stressed]

The temporary break in social security withholding also goes away at the end of 2012. I think it was a 2% cut. I don't think the OP was making a political statement other than using the silly terminology coined by the media.

[LadyInTheRed]

I don't think the OP was making a political statement other than using the silly terminology coined by the media.

Neither do I. My comment was not directed at the OP, but to those who might find it very tempting to turn the thread into a political discussion. It's a very relevant topic to bring up for people in Chap 13 and I don't want it to get off track.

[DirkDiggler]

I'm clinging to the hope the fiscal cliff is avoided so my unemployment will continue

[goon]

This brings up a good question. Increased recurring tax liability would essentially reduce disposable income.

So would it be legit to file a plan modification based on the reduced DMI because of increased tax rates? (if taxes do go up in a way that would affect most of us in BK13s).

Could we end up seeing a massive amount of plan modifications filed next month?

[justbroke]

So would it be legit to file a plan modification based on the reduced DMI because of increased tax rates? (if taxes do go up in a way that would affect most of us in BK13s).

Could we end up seeing a massive amount of plan modifications filed next month?

If your tax liability changes and your DMI is reduced, you may be able to modify a confirmed Chapter 13 Plan for that reason. Please realize that you would probably need to file a new Schedule I/J and Form B22C (Means Test). This may open you up to scrutiny especially if your base income increased.

As for massive plan modifications, only time will tell.

[alorth]

I started a thread about this very topic back on Oct. 3rd if anyone's interested in reading some more discussion on the fiscal cliff topic and CH13.

http://www.bkforum.com/showthread.php?78296-How-possible-coming-tax-increases-could-affect-Plan&p=584517#post584517

(and for the record, I'm actually more worried about this now than ever!.....We do NOT have any room in our budget to absorb the 2% payroll tax increase that will go into effect immediately)

[pamkev]

We are concerned about the cliff and we filed a Chapter 7. We are saving money for the first time in years and feeling good about it. Now if this tax hikes happen it will take away what we are saving and the cost of items will be going up. We will have to look at our budget again and see what we can cut out or reduce. We are on a mission to keep saving as that is the most important thing to us now.
Pam

[AngelinaCat]

We are very concerned, as our income is basically a yearly stipend from a retirement instrument--which largely takes care of the property taxes and other large ticket expenses. The monthly income is 'Hub's SS, and a small pension. Those things and the stipend are 'fixed' income. I am not of the age to be able to draw a retirement yet, and my PT job's pay is wildly variable. So we can't really count on that. And I was just notified that I did NOT get the latest FT job I applied for.

If taxes, fees, and prices go up like we think they will, I don't know what we are going to do. It has been extremely tough for us to get the 'ends' to meet this year as it is. At the same time, we recognize that we are in a much better place than many are, because we do not havea mortgage, and for that we are very thankful.

[tobee43]

this will effect everyone, not just those in 13.

we can barely meet the expenses now, no less if the costs rise. it's difficult to keep this non political when it's a political subject.

[LadyInTheRed]

it's difficult to keep this non political when it's a political subject.

I know. That's why I posted a preemptive warning. You can always get political at http://www.bkforum.com/showthread.ph...cussion/page88

[enginegirl]

Thanks Lady inRed and all the other posters. I thought I was really the only one paying any mind to the end of the temporary tax cuts given in the Bush era. The 2% I will be ok with.. barely...... but the rest of it... is making me sick to my stomach, but everyone seems to think it may be a short term pain... lets hope that all sides come to an agreement soon, and we can all continue on....

[AngelinaCat]

One of my problems is that every time some aspect of Obamacare is enacted, I get a letter from my catastrophic health care provider informing me that my monthly rate will go up $30.00 a month, to enact some provision of the 'Affordable Health Care Act', aka Obamacare. My health care insurance is certainly not affordable for me with a monthly payment of $390.00 a month, and I have a $3500.00 deductible, that I have to pay out of pocket before any insurance kicks in.

I am five years away from Medicare, which I do not believe will be in existence when I need it. Nor can I get a FT job with benefits at my age. I just got turned down on the latest one I applied for....

As bad as 2012 was, I am in abject fear of 2013.....