US Trustee Presumption of Abuse

[justbroke]

Do you know where I could get my hands on one of these spreadsheets?

I personally recreated it and have it. I was supposed to post it to my blog. If enough people ask for it... I'll post it to my blog this weekend.

[Fallonedward]

Do you know where I could get my hands on one of these spreadsheets?

I know I'm late, but the Region 21 United States Trustee's (UST) minions use a specialized spreadsheet, which I replicated for my own use after seeing attached as an exhibited to a Motion to Dismiss under 707(b)(3), that they use. It specifically shows what was entered on Schedule I/J and the "offset" that the UST is using. I personally used it to work EVERY scenario from them disallowing an expense, to reducing an expense, to make sure that I was still eligible.

There are expenses that I see, including the cellular phones, food, clothing, that are high. You do have the benefit that in some areas, the Trustee actually increased your deduction (to be fair!). As other posters wrote, your 401(k) deduction is a big red flag and shouldn't have been on your Schedule J.

You are way over the median, as you know, and your attorney should have known that these items would be attacked. I have over a $400/month cellular phone bill (don't ask) and I only put $150 on my Schedule J because I know what the threshold is.

Again, having the spreadsheet helps so that you can experiment with what the Trustee might question. It wouldn't take the UST "much" poking to get you in a Chapter 13, since you have multiple questionable expenses.

If your attorney is going to fight for you, and you have a defensible explanation, then go for it!

[momofthree]

If you look at the US trustee website, the trustee has clearly lowered each section to the IRS standards. He's not objecting to certain expenses so much as requiring you to fit those expenses within the IRS standards. I'm guessing you're a family of 5 since that's the IRS standard amounts that he used for each category. It sounds to me like he's playing quite fair as far as trustees go.

As far as the income having such a huge discrepancy ($900/mo), are you paid bi-weekly? Do you get a tax refund each year?

Here is the website for IRS standards if you want to check it out: http://www.justice.gov/ust/eo/bapcpa...anstesting.htm

[justbroke]

B2S, isn't the means and schedules run through the same software automatically claim "Presumption of Abuse"? I think it does when it crosses a certain line. Does not mean it is reality, but then causes a bit of proof. I've seen this here before, and usually it is a software computation and not the real numbers. Most prove otherwise.

I know I'm late, but the Region 21 United States Trustee's (UST) minions use a specialized spreadsheet, which I replicated for my own use after seeing attached as an exhibited to a Motion to Dismiss under 707(b)(3), that they use. It specifically shows what was entered on Schedule I/J and the "offset" that the UST is using. I personally used it to work EVERY scenario from them disallowing an expense, to reducing an expense, to make sure that I was still eligible.

There are expenses that I see, including the cellular phones, food, clothing, that are high. You do have the benefit that in some areas, the Trustee actually increased your deduction (to be fair!). As other posters wrote, your 401(k) deduction is a big red flag and shouldn't have been on your Schedule J.

You are way over the median, as you know, and your attorney should have known that these items would be attacked. I have over a $400/month cellular phone bill (don't ask) and I only put $150 on my Schedule J because I know what the threshold is.

Again, having the spreadsheet helps so that you can experiment with what the Trustee might question. It wouldn't take the UST "much" poking to get you in a Chapter 13, since you have multiple questionable expenses.

If your attorney is going to fight for you, and you have a defensible explanation, then go for it!

[tobee43]

These accounts were all started at least 9 + years ago, so that is good news.

I have all 5 of us with phones

wow....all 5..i guess nowadays everyone needs a phone. i just don't know what we did before...LOL!! now if i had kids i would MAKE them carry one.

our's is like 90 a month and it's unlimited everything but verizon was one of our work accounts and we still get 17% discount on the entire bill. so 165 seems somewhat reasonable for all those phones i think.

[Fallonedward]

These accounts were all started at least 9 + years ago, so that is good news.

I have all 5 of us with phones

If you started the savings over a year ago, they will not be touched by the trustee. It is 529 accounts that get started right before filing that the trustee takes over as assets.

$165 a month for cell phone should be fine as long as there are 3-4 phones on the plan. If that is only for 2 phones, that would be considered high.

[backtoschool]

That's what we pay. For 2 phones.

Verizon-1400 minutes. (Dh uses a good portion of that for work) Both phones have data plans. With all of the taxes and garbage they add on, it comes out to $165/mo. for 2 phones.

If a filer is close to being kicked into a chapter 13, the trustee will often question 3g phone plans with unlimited data as a necessity. Same for premium cable. Cutting phone plans and premium cable are often enough to push someone into a 13.

[JEM]

If you started the savings over a year ago, they will not be touched by the trustee. It is 529 accounts that get started right before filing that the trustee takes over as assets.

$165 a month for cell phone should be fine as long as there are 3-4 phones on the plan. If that is only for 2 phones, that would be considered high.

That's what we pay. For 2 phones.

Verizon-1400 minutes. (Dh uses a good portion of that for work) Both phones have data plans. With all of the taxes and garbage they add on, it comes out to $165/mo. for 2 phones.

[backtoschool]

I'm confused - is this a 7 or 13?

they are trying for a 7.

[tobee43]

i thought a 7???? but then i can't read until 11 am...that's when the coffee finally kicks in!

[Freddy03]

I'm confused - is this a 7 or 13?

[backtoschool]

Each of my 3 kids have savings accounts started for them when they were born, birthday and christmas monies, plus monies they earned has gone into these accounts. No child has more then $400 in their account. Do you feel that these accounts can be taken from my kids as their are held in trust by me with their names on the accounts (since they are minors)????

Our cell is $165 ( we had to downgrade like crazy to get it to that amount) do you think this amount will raise a flag???


My stomach is nervous like the dickens now and just when I thought I could relax...thanks Tom for any help you can provide

If you started the savings over a year ago, they will not be touched by the trustee. It is 529 accounts that get started right before filing that the trustee takes over as assets.

$165 a month for cell phone should be fine as long as there are 3-4 phones on the plan. If that is only for 2 phones, that would be considered high.

[tobee43]

maybe i missed something here...but OP is or has filed a chapter 7. the atty should have had this situation down to the penny. personally, i think some of the expenses are low...i.e. utilities....221???? wow...i live down south and we pay (and ours is the absolute LOWEST of all our neighbors) just in electric over $300...water, sewer, garbage here runs well over $400 (we were shocked but that is what it is down in cheap where one is suppose to retire florida).

so i suppose it's all relative, but OP's figures seem more than fair for where they live.


tom has the lived the colo. bk...however, i agree with many of the PP...there is some mistake. or this trustee is attempting to pull the OP into a 13 due to the DMI. and the example of what tom refers to is associated with a 13.

i agree something must be caught between the nets....the starting point is a darn good explanation from your atty's office as to what and why this happened.

[Fallonedward]

Each of my 3 kids have savings accounts started for them when they were born, birthday and christmas monies, plus monies they earned has gone into these accounts. No child has more then $400 in their account. Do you feel that these accounts can be taken from my kids as their are held in trust by me with their names on the accounts (since they are minors)????

Our cell is $165 ( we had to downgrade like crazy to get it to that amount) do you think this amount will raise a flag???


My stomach is nervous like the dickens now and just when I thought I could relax...thanks Tom for any help you can provide

Hi again cjsgac,

Income: +853 difference This should come directly from your most recent paystub, should be easy to figure who's right, who's wrong

Personal living expenses: -167 Seen folks w/trouble on the pet care, some roll it into something else; seen kids act. over 125 picked on,

Utilities: -221 everything looks in range except the phone bill, I'll bet dollars to doughnuts that is where the difference is

Housing, vehicles: +57 no problems here

Medical: -89 some receipts could clear up, maybe even put you ahead

Cable/internet: -50 could show bill and say internet is justified for kids education

Life insurance: +57 in your favor, no problems here

"PC loan" "loan" paycheck deduction: not sure what this is

401K: -353 This is a biggee....and contradicting caselaw on the subject, but more recent cases are in your favor. This might help:

...in a Chapter 13 case as the contributions and loan repayments Debtor makes to her 401K would not be considered as disposable income with which to fund a Chapter 13 plan. In re Garrett Ch. 13 Case No. 07-3997 (M.D. Fla. January 18, 2008). In Garrett, this Court held that based upon the addition of §§ 541(b)(7) and 1322(f) to the Bankruptcy Code, retirement account contributions and repayment of a loan secured by a retirement account do not constitute disposable income in a Chapter 13 from http://pacer.flmb.uscourts.gov/pdf-new/45051718.pdf

Hope some of this helps, just my 2 cents..probably what its worth...

Tom in Colo

[tcreegan]

Hi again cjsgac,

Income: +853 difference This should come directly from your most recent paystub, should be easy to figure who's right, who's wrong

Personal living expenses: -167 Seen folks w/trouble on the pet care, some roll it into something else; seen kids act. over 125 picked on,

Utilities: -221 everything looks in range except the phone bill, I'll bet dollars to doughnuts that is where the difference is

Housing, vehicles: +57 no problems here

Medical: -89 some receipts could clear up, maybe even put you ahead

Cable/internet: -50 could show bill and say internet is justified for kids education

Life insurance: +57 in your favor, no problems here

"PC loan" "loan" paycheck deduction: not sure what this is

401K: -353 This is a biggee....and contradicting caselaw on the subject, but more recent cases are in your favor. This might help:

...in a Chapter 13 case as the contributions and loan repayments Debtor makes to her 401K would not be considered as disposable income with which to fund a Chapter 13 plan. In re Garrett Ch. 13 Case No. 07-3997 (M.D. Fla. January 18, 2008). In Garrett, this Court held that based upon the addition of §§ 541(b)(7) and 1322(f) to the Bankruptcy Code, retirement account contributions and repayment of a loan secured by a retirement account do not constitute disposable income in a Chapter 13 from http://pacer.flmb.uscourts.gov/pdf-new/45051718.pdf

Hope some of this helps, just my 2 cents..probably what its worth...

Tom in Colo