Stimulus Money

[imtryingtho]

What has been the results so far on stimulus money and whether trustees ask for it? We have two different situations.

1) In 2019 we made too much to qualify for all of the stimulus money last year but in 2020 we didn’t make as much since I had quit my job. When we filed our taxes last month, we got the rest of the 2020 stimulus money as a recovery rebate. We initially owed $50-60, but the stimulus money took us into getting a refund of $4500 or so. Normally we would give our refunds to the trustee, but since this was CARES money, we aren’t sure if we still have to.

2) We got our latest stimulus money deposited today at $5600. Will the trustee expect that?

We are in a 13 less than 100% plan filed in October 2020. We have emails out to our lawyer, but he isn’t responding and we are getting worried about breaking rules if we don’t send money that we are supposed to. We have numerous things we would use the money for including landscaping after the Texas winter storm killed half of our plants. When we filed we exempted quite a bit of cash and I’m frustrated we didn’t put future stimulus money into the plan too.
flashoflight I know you’re in the same district, have you heard anything?

[brokenurse]

I got the first two stimulus checks and they asked for neither, but I am in a 100% plan. I thought it was untouchable to them, so to speak.

I dabbled in real estate as a side gig last year, which kicked us over the income limit for this latest stimulus. I could kick myself for filing our 2020 taxes so early.

[justbroke]

No one knows how the Chapter 13 Trustees will deal with this. It's not a tax refund so much as it is a refundable tax credit. The Executive Office of the United States Trustee (OUST) has opined and encouraged Chapter 13 Trustees to not demand the stimulus checks from debtors. However, that is only a suggestion and the stimulus money isn't otherwise protected.

So it's best to hear directly from your attorney as to your specific Chapter 13 Trustee.

Since you're in a Chapter 13, just keep it in the bank as your emergency fund unless you really need the money. You can always appeal to the court if you have emergency expenses, not too unlike how you can request to keep all or part of a tax refund. (For Districts that require surrender to tax refunds.)

[imtryingtho]

I got the first two stimulus checks and they asked for neither, but I am in a 100% plan. I thought it was untouchable to them, so to speak.

I dabbled in real estate as a side gig last year, which kicked us over the income limit for this latest stimulus. I could kick myself for filing our 2020 taxes so early.

Yeah I have a friend who waited until now to file for this reason!

[Zombie13]

Well, we were thinking, hey cool we can hang on to this, breathe a little... but of course not. We have to fix the car argh. Nonetheless, if the trustee wants the stimulus check there should be the court process: We would get a letter from the trustee saying, 'we want more money; we want the stimulus'. So then we would have to do the I and J forms again; may as well since we have to demonstrate the income, expenses, etc. to prove "Hey! we lost $200 in income a month after approval of the latest modification, thanks for being awesome!" (this loss is due to increase in medical insurance expenses). Oh and we would also present the bill for vehicle computer analysis (ie proving the car does have true failures) and parts replacement (most likely the transmission). So then we'd do the hurry up and wait, a few phones calls, then maybe something, maybe nothing, from the trustee.
For us, using the cash funds to repair the vehicle used to get to work is better than using 401k funds and asking permission before, or forgiveness after. If I can't get to work, I can't do the job. If I can't do the job, I can't pay the plan. If I can't pay the plan, I get canned from the plan. That's a tongue twister btw... try it!
I'm not thrilled with fixing the car, but it's better to spend the funds to fix something we need.

[flashoflight]

imtryingtho I'm in the California central district and nobody has ever asked for the stimulus. I believe there are certain exceptions for keeping the tax refund such as the stimulus so I'd have your attorney give a heads up to the trustee's office that you are keeping the stimulus portion of the refund.

[Barbisi]

As Zombie 13 said, the car is essential.
Currently, the thirty year old furnace is still working, but the 46 year old swamp cooler is probably going to have to be repaired if not replaced. Since it routinely snows here until mid-May, we won't know until then just how much money we're going to be out!
So yes, we'll wait and see if we are contacted about the stimulus -if not we will fix what ever is broken, that we have enough cash to do and provide receipts if necessary.