Observed 341 meeting and a question.

[TITUS00]

I went to observe a 341 meeting in my district today. I noticed that the trustees seemed very polite. They needed copies of 6 months of pay stubs and 2 years of income tax returns. No mention of bank statements at all. They were interested to know if debtors used credit cards speaking with their attorney. Most cases went by fast, about 5 minutes or less. I feel much more confident now that I saw what it is all about.

I have a question about the means test. I just found out that my wife earns a lot more than I thought. Even considering that I am on unemployment, we are still way over the median, but when considering the part of her salary that actually goes to maintaining the household, then I pass according to the NOLO test. I file my taxes married-not filing jointly. I have been filing this way for 9 years. Can I pass the means test?

[music12]

i am not following what it is that you found out about your wife's salary and what you mean by "the part of her salary that actually goes to maintaining the household." what happens with the rest of it?

if she makes a lot more than you thought, perhaps you should consider paying the debts instead of filing bk?

[TITUS00]

i am not following what it is that you found out about your wife's salary and what you mean by "the part of her salary that actually goes to maintaining the household." what happens with the rest of it?

if she makes a lot more than you thought, perhaps you should consider paying the debts instead of filing bk?

What are you not following about finding out my wife's salary is more than I thought it was? As for the second part of the statement it happens to be Question 17 on the NOLO means test "If you are married, living together, but filing singly: Enter the portion of your spouse's income that was NOT used for your support or the support of your dependents:" I did mention that we do not file our taxes jointly. In other words she makes a contribution to all the household expenses on a monthly basis and I pay all the bills with it. That contribution is what Question 17 asks to list.

[music12]

oh! then your question is beyond the scope of my knowledge.

i know you didn't ask about this, but if you suddenly found out that your wife makes more than you knew about, you've got bigger problems than bk in my opinion. but that's probably beyond the scope of this forum altogether.

[TITUS00]

oh! then your question is beyond the scope of my knowledge.

i know you didn't ask about this, but if you suddenly found out that your wife makes more than you knew about, you've got bigger problems than bk in my opinion. but that's probably beyond the scope of this forum altogether.

You know what they say about opinions.

[backtoschool]

You know what they say about opinions.

TITUS00, we all try to answer your questions the best we can, myself included. But I have to admit that your posts always have an unpleasant tone to them. Why is that?

Your wife's income will be figured into the means test if you live with her, regardless of whether you file taxes with her.

If you try to separate out your wife's income or parts of it and you live together, then plan on spending a lot of time answering questions from the US Trustee, because a high income, combined with large cash advances only a couple of months ago, combined with a large suddenly discovered income from your wife, will lead to a huge totality of circumstances and presumption of abuse flag.

[TITUS00]

TITUS00, we all try to answer your questions the best we can, myself included. But I have to admit that your posts always have an unpleasant tone to them. Why is that?

Your wife's income will be figured into the means test if you live with her, regardless of whether you file taxes with her.

If you try to separate out your wife's income or parts of it and you live together, then plan on spending a lot of time answering questions from the US Trustee, because a high income, combined with large cash advances only a couple of months ago, combined with a large suddenly discovered income from your wife, will lead to a huge totality of circumstances and presumption of abuse flag.

I do not plan on answering any trustees question in the near future, at this point I am simply evaluating all my options and trying to acquire as much information as I can to help me do so. According to NOLO the means test does take into consideration people in my situation as I have noted. If the questions do exist on the means test and I answer the questions truthfully I see no reason to presume abuse. Of course I could be wrong so I am trying to get opinions from anyone that might have any knowledge about this specific part of the means test. I apologize if you feel my posts are unpleasant, you are always very helpful.

[backtoschool]

I do not plan on answering any trustees question in the near future, at this point I am simply evaluating all my options and trying to acquire as much information as I can to help me do so. According to NOLO the means test does take into consideration people in my situation as I have noted. If the questions do exist on the means test and I answer the questions truthfully I see no reason to presume abuse. Of course I could be wrong so I am trying to get opinions from anyone that might have any knowledge about this specific part of the means test. I apologize if you feel my posts are unpleasant, you are always very helpful.

I am definitely trying to help. The key for the means test is household income. The trustee will definitely look at your wife's income, and try to use some of it to fund a chapter 13. Presumption of abuse simply means that the trustee will either throw your case out or try to fund a chapter 13. In your situation, since your income was high anyway before you were laid off, the trustee will try to find income to fund a chapter 13. Since your wife contributes to the household income and expenses, her income is fair game for the means test.

It would be a VERY difficult argument to say that your wife lives with you, makes a good income, and is not contributing that income to living expenses. Even if you could prove this with receipts etc, there is a good chance that your case would be flagged by the US Trustee for totality of circumstances.

The best bet for you is to wait to file until you can get your income down, or to resign yourself to a chap 13. How much extra income are we talking about here?

[TITUS00]

I am definitely trying to help. The key for the means test is household income. The trustee will definitely look at your wife's income, and try to use some of it to fund a chapter 13. Presumption of abuse simply means that the trustee will either throw your case out or try to fund a chapter 13. In your situation, since your income was high anyway before you were laid off, the trustee will try to find income to fund a chapter 13. Since your wife contributes to the household income and expenses, her income is fair game for the means test.

It would be a VERY difficult argument to say that your wife lives with you, makes a good income, and is not contributing that income to living expenses. Even if you could prove this with receipts etc, there is a good chance that your case would be flagged by the US Trustee for totality of circumstances.

The best bet for you is to wait to file until you can get your income down, or to resign yourself to a chap 13. How much extra income are we talking about here?

I hear where your coming from and she is contributing to the living expenses. We file our taxes, married-not filing jointly every year. It seems that the means test adds an extra section for people who file as I do. If the means test asks for specific numbers regarding this type of situation then I have to think that it could go through. I probably will have to speak to an attorney when the time comes to get a definitive answer. I do realize that a Chapter 13 might be a possibility.

[MSbklawyer]

There is a line on the means test that takes into account money that the debtor's spouse does not contribute to household expenses. It could be anything. A gambling habit, for instance. In a non-community property state, the non-debtor spouse is not jointly liable for the debtor's separate debts. He/she cannot be compelled to make payments on those debts out of his/her separate income. Nor can the debtor's discharge be held hostage because his spouse refuses to contribute to household expenses.

But you are going to be put under an electron microscope about the spouse's non-contributions, so be ready for it.

[TITUS00]

There is a line on the means test that takes into account money that the debtor's spouse does not contribute to household expenses. It could be anything. A gambling habit, for instance. In a non-community property state, the non-debtor spouse is not jointly liable for the debtor's separate debts. He/she cannot be compelled to make payments on those debts out of his/her separate income. Nor can the debtor's discharge be held hostage because his spouse refuses to contribute to household expenses.

But you are going to be put under an electron microscope about the spouse's non-contributions, so be ready for it.

I will probably need a talented attorney to avoid a Ch 13, or totally exhaust my unemployment benefits to get close to the median. Hopefully it never comes to either of those scenarios, but I am a pessimist by nature.

[backtoschool]

New Jersey is a non community property state, but the key here is totality of circumstances. If your wife has a large income that is not contributing to household expenses, then the trustee will look at every single expense under a microscope. If your car payment is above average, or your mortgage could be cheaper if you moved, or you send your kids to a private school, or you eat out once a week, every single discretionary expense will be looked at to fund a chapter 13. The trustee only has to come up with $160 a month or so of discretionary expenses to throw you into a chapter 13.

So even if part of your wife's income is not used to fund a chapter 13, your wife's income will raise a red flag to the trustee who will then examine each and every expense to try to find the money to fund a chapter 13.

[TITUS00]

New Jersey is a non community property state, but the key here is totality of circumstances. If your wife has a large income that is not contributing to household expenses, then the trustee will look at every single expense under a microscope. If your car payment is above average, or your mortgage could be cheaper if you moved, or you send your kids to a private school, or you eat out once a week, every single discretionary expense will be looked at to fund a chapter 13. The trustee only has to come up with $160 a month or so of discretionary expenses to throw you into a chapter 13.

So even if part of your wife's income is not used to fund a chapter 13, your wife's income will raise a red flag to the trustee who will then examine each and every expense to try to find the money to fund a chapter 13.

Since we are talking about Chapter 13's, is there a limit to the amount that has to be paid back? Is the limit the total unsecured debt or is it non-exempt assets. I am assuming it is the unsecured debt.

[backtoschool]

Since we are talking about Chapter 13's, is there a limit to the amount that has to be paid back? Is the limit the total unsecured debt or is it non-exempt assets. I am assuming it is the unsecured debt.

How much you pay back in a chapter 13 is based on how much discretionary income you end up having on your schedules, and how much secured and priority debt you have to pay off. Once the discretionary income is applied to the secured and priority debt, then a percentage of the unsecured debt is paid off.

[music12]

nobody will make you pay back more than you owed to begin with! if you have more non-exempt assets than debt, then you are not bankrupt, so don't file.