Pro Se Dismissal Chapter 7

[2Bshinyandnew]

If the CH7 is dismissed why wouldn't the creditors have the same incentive to work with you as anyone else?

The resulting tax liability on the forgiven debt would be 15% (maybe 20%, depending on the tax payers tax bracket) of the forgiven debt. So if the original debt is $100K and your creditors settle for $50K, you receive a 1099 for the forgiven $50K which results in a tax liability to the IRS of $7500-$10000, so the debtor is paying out $57500-$60000 including tax liability to settle $100K debt. Not bad if you have the cash, which someone who just received an inheritance will have.

It is a numbers game. If the inheritance is large enough to pay off all the original debts amounts, and you go through a ch7, the trustee isn't going to negotiate a lower settlement, is he? What would be the trustee's incentive to do that? None, since the trustee gets paid a % of the "take", the higher the better. Any agreement made with the creditors outside the BK process should be "better" than what the trustee will do, so long as you can legitimately dismiss the petition.

I don't know how much money the OP is inheriting or what the actual #'s are, but if the scenario is like I stated above, i would keep looking for ways to dismiss the CH7 and offer the creditors a settlement once the inheritance is actually in his bank account.

[TEW]

Good day all!

After learning that a future inheritance will be seized by the trustee, I want to dismiss my Chapter 7 (filed on 1/14/09, 341 on 2/9/09) and work with my creditors.Work with them how? Pay them a little bit pay them in full?

Can I do this and what are the ways.

Thank you for your input!

[JRScott]

Most likely if you failed to appear the Trustee can take a few actions:

1. He could dismiss with prejudice if he thinks you are trying to protect your inheritance. (probably the least likely but it is possible).

2. He could dismiss without prejudice if he does so because you didn't appear. (this is the probable outcome).

3. He could decide to give you a break and continue the meeting to another date. (This is a rare occurrence as is 1 in most jurisdictions)

Depending on the value of the inheritance it may or may not be worth their effort.

You could file a motion to dismiss but keep in mind it may or may not be granted as others aid.

If you do nothing and proceed:

What would happen is your case would proceed normally to discharge, then the case would not be closed until the inheritance was settled. The Trustee would then decide if it is worth their effort to seize or not (generally they look I think for around a thousand dollars or so). If its big enough he'll take it let the creditors know funds are available, they'll each file a claim, he'll distribute the funds, he'll pay himself to administer the estate, any leftover if there is any would be returned to you.

[justbroke]

What if at the 341 I discuss the dismissal?

I don't think you can discuss it. It's by motion to the Court, not to the Trustee.

[BKINTEXAS]

What if at the 341 I discuss the dismissal?

[justbroke]

What if happen to miss the 341?

What happens then?

If you miss your 341 and the Trustee knows of your inheritance... they may motion to dismiss the case with prejudice. Otherwise, they'd normally just motion to dismiss for failure to appear.

This is dicey.

[BKINTEXAS]

What if happen to miss the 341?

What happens then?

[BKINTEXAS]

In my filing I stated that there is an inheritance - not trying to hide it.

As of this day I do not know the actual amount or when I will receive it, but I'm certain I will receive within the 180 day period - perhaps in April, 09.

The nuts and bolts - I would rather deal with my creditors than have the inheritance seized. If I had the inheritance prior to filing I wouldn't have filed.

[justbroke]

Good day all!

After learning that a future inheritance will be seized by the trustee, I want to dismiss my Chapter 7 (filed on 1/14/09, 341 on 2/9/09) and work with my creditors.

Can I do this and what are the ways.

Thank you for your input!

No, you can't dismiss a Chapter 7.

Unfortunately Chapter 7s become a life of their own once they are initiated. Having wrote that, you may be able to get it dismissed, but you actually have to motion for it, and it may not be granted.

A Chapter 7 can only be dismissed for cause, and the Judge has discretion. He will be looking at, are you trying to hide money.

This is a problem which plagues pro se filers all the time, so you are not the first. However, Chapter 7s are rarely dismissed by Motion.

[BKINTEXAS]

Good day all!

After learning that a future inheritance will be seized by the trustee, I want to dismiss my Chapter 7 (filed on 1/14/09, 341 on 2/9/09) and work with my creditors.

Can I do this and what are the ways.

Thank you for your input!