Receipts

[mintz]

We typically do not save receipts unless we are doing home improvements and medical. Should we start saving all receipts? We do the bill pay on line and figure that is our receipts?

[Help!]

Yes, save all receipts. If you rely on email statements with embedded links or online statements, print them before you file as you will not be able to access them after you file. You never know what documentation you'll be asked to provide, so save absolutely everything related to your finances during your BK.

[mintz]

so save absolutely everything related to your finances during your BK.

So, what you are telling me is right now *I have not filed nor spoken to anyone to file) I do not need to keep/collect my receipts?

[Keebler]

We kept EVERYTHING for more than a year before we filed. It doesn't take up much space and it sure felt good knowing we could handle any request the Bankruptcy system threw our way.

Remember, Chapter 7 requires you to show that you have no disposable income to repay your debts and every receipt and bit of history you have regarding your living expenses will only help your case.

Saving those receipts can't hurt. If you listed all the things that could happen by throwing them away or keeping them you'll find that there's lots of good reasons to keep them and almost no good reasons to throw them away.

[Help!]

So, what you are telling me is right now *I have not filed nor spoken to anyone to file) I do not need to keep/collect my receipts?

No, what I meant was if you have not been saving receipts and are getting ready to file to start saving them. If you haven't filed yet, save every receipt now also. We ended up submitting receipts for the six months prior to filing, and without them our case would have been dismissed (but ours was not the norm).

[mintz]

Remember, Chapter 7 requires you to show that you have no disposable income to repay your debts and every receipt and bit of history you have regarding your living expenses will only help your case.

Disposable income.....so basically if our bills exceed our income we should have no problem filing??? We have rental property also and not getting paid by our renters so we have already agreed to let that bill go. We are now late 10 days to our banks mortgage but we have paid the past mortgages out of our savings and just cant do it anymore.

[Keebler]

Disposable income.....so basically if our bills exceed our income we should have no problem filing??? We have rental property also and not getting paid by our renters so we have already agreed to let that bill go. We are now late 10 days to our banks mortgage but we have paid the past mortgages out of our savings and just cant do it anymore.

Looking back six months from the day you file, your bills for necessary expenses need to be reasonable for your family and they need to show that your cost of living matches or exceeds your income.

Any expenses you have that are unusual or seem high can be questioned and you may need to use receipts to shown that you actually have those expenses. If the expenses that are questioned are rejected, your disposable income will be affected and you could potentially be pushed in to Chapter 13 instead.

Payments on debts you're allowed to reaffirm will be counted as part of your living expenses but payments on debts that would be discharged will not be. For example, your mortgage might be considered reasonable and you might reaffirm it and include it as part of your living expenses.

The rules for Chapter 7 are fairly clear and yet the various Trustees around the Nation seem to use very different levels of scrutiny. In my district the court seems to be lazy and doesn't ask too many difficult questions or dig too deep beyond the figures on the Bankruptcy petition. Other districts seem to have a completely different philosophy and nit pick every detail and try to find fault with everyone's petition.

[mintz]

We can pay our expenses without an issue ie mortgage, utilities,auto's,furniture, food, gas. The issue is we over spent on home improvements, clothes for the kids, laptops for kids in college ect..and finding it difficult to pay the credit card bills and our normal expenses. Do you think we would qualify for a chapter 7?

[Phillymanhere]

If you want an answer to your question you will need to get really specific, as in giving your state, how much you are above or below the median income for that state and how much debt you have, the type of debt, etc. Bankruptcy is really specific. The details make all the difference.

Do you understand the "means test"? Chapter 7 has a means test. It's not absolute, but it's a starting point. If your income is above the median income for the family of your size for your state, then it gets a little harder (though not impossible) to successfully file for a chapter 7.

In addition, there are limits to what the court considers "reasonable" expenses for particular categories, as in clothes, food, etc. People are telling you to save your receipts because if you are above the recommended spending for a particular category, the court will often require receipts to prove that you are indeed spending the money the way you say you are. For example, I have unusually high medical bills. The expected monthly medical expenditure for a single person like me in my state is like $60 a month or so. Well, I can sometimes spend $300 a month between doctors and various therapists and various prescriptions. I save all my medical receipts these days because I know that when I file, the court will want evidence that I really am spending so much on my medical care. The court will not approve my bankruptcy just on my word that yes, I'm spending almost $250 more a month than is typically expected.

You may want to read through some old threads. There are dozens of them on the means test.

[mintz]

Thanks for the explanation. We have cut out going ut to eat but I seldom save my receipts for gas, food, kids going to movies ect... We live in Texas and we fall about $15,000 above the means test (I think) but we barely have any spending left over at the end of the month to save for anything in case of an emergency. We have also had to dwindle down our savings to make our rental payments for our property due to people not paying their rent.