US Trustee Presumption of Abuse

[rjmwx81]

3. 401k payment/loan payment this is not allowed in many districts and your US trustee has flagged it. Your pc loan is not being allowed either.

This gets me kind of mad. Your attorney should have known better.

[backtoschool]

It looks like the US trustee has problems with the following areas:

1. Your utilities and food, etc. My guess is that the cell phone bill is being questioned. That is very high for a cell phone bill, when extra lines should only be costing you $10 a month and you can share minutes. Food expense is very high at $900. How big is your family? The $200 misc expenses would also be questioned.

2. Home Maintenance. You are over the US standard here and you are going to need receipts to back your expenses up. Again this can be fought and won.

3. 401k payment/loan payment this is not allowed in many districts and your US trustee has flagged it. Your pc loan is not being allowed either.

These things flagged are enough to kick you into a chapter 13. (you only need between $150 a month and $180 a month disposable income to be kicked into a chap 13).

What to do: Gather all your receipts. Have a business reason for why you need the cell phone plan that you do. Come up with more medical, insurance, dues and fees, and other legitimate expenses to replace the ones you are going to have to remove from your petition.

This can be fought, but from the looks of this, it really does look like you have a couple of hundred dollars a month in disposable income to fund a chap 13. You are going to really have to dig into your receipts and expenses and come up with some more legitimate expenses.

[Wantmypeace]

I would like to see what all the notes are. There are notes referenced in a lot of places. Do those notes explain the discrepancies? Is your income amount accurate, or is the trustee's income amount accurate? If the income numbers he has are wrong, it seems like this would be an easy fix...

[cjsgac]

Thanks for all your replies!
Makes me feel better.

Here is the US Trustee's Analysis of our Schedule I and J

Debtor(s) Sch
I & J
UST
§707b3
Analysis Notes
Gross Income:
Combined Gross Wages $ 9,935 $ 11,204
Subtotal US $ 9,935 TRUSTEE $ 11,204 Note 1
Payroll Taxes US $ 1,881 TRUSTEE $ 2,297 Note 2
Average monthly income US $ 8,054 TRUSTEE $ 8,907

Current Expenditures
Personal Living Expenses
$ 1,633
Food $ 900
Clothing $ 200
Laundry/dry cleaning $ 80
Recreation $ 100
Kids Activities $ 170
Misc. unexpected $ 200
Grooming, Pet Food & Care $ 150
US $ 1,800 TRUSTEE $ 1,633 Note 3
Utilities
Local Standard TRUSTEE$ 468
Electric and heat US $ 179
Water/sewer US $ 50
Telephone and Cell phones US $ 290
Trash US $ 30
HOA Dues US $ 40
Home maintenance US $ 100
US $ 689 TRUSTEE $ 468 Note 4
National STD
Housing:
Future Secured debt payments
Standard Housing allowance less secured debt
Standard Housing allowance $ 1,998
Rent or Mortgage payments $ 2,468 $ 470
Insurance
Taxes
US $ 2,468 TRUSTEE $ 2,468 Note 5
Vehicle Operating Costs
Vehicle Operating STD $ 472
Transportation $ 500 $ 179
Auto Insurance $ 151
US $ 651 TRUSTEE $ 651 Note 6
Vehicle Ownership Costs
60 month avg Secured debt payment
Standard allowance less debt payments
Standard allowance $ 992
Monthly payment $ 935
US $ 935 TRUSTEE $ 992 Note 7
Health Care expenses
Nat'l Std $ 300
FSA $ 63
Medical/dental expenses $ 300
Insurance $ 483 $ 457
US $ 846 TRUSTEE $ 757 Note 8
Other Expenses
Life Insurance US $ 80 TRUSTEE $ 137 Note 9
401K and 401K Loan $ 353 $ - Note 10
"PC Loan" and "Loan" pay check deductions $ 60 Note 11
Cable/Internet US $ 150 TRUSTEE $ 100 Note 12

Average monthly expenses US $ 8,032 TRUSTEE$ 7,207

Monthly net income US $ 22 TRUSTEE $ 1,700


Total Plan Payments $ 101,992
Ch 13 Trustee Fees $ 6,323
Priority Claims $ - Schedule E
Additional Attorney Fees $ 1,500
Available for Unsecured Creditors $ 94,168
Unsecured Debt $ 131,408 Schedule F
Dividend to Unsecured Creditors 71.66%


Bottom line is that our income is about $2000 off....when we filed our attorney mentioned a software glitch that was discovered after. I wonder if that has something to do with it??? Any input is appreciated. Thanks!

[tcreegan]

Hi cjsgac, ...fellow Coloradoan here!

Lots of folks around here have survived a UST presumption/dismiss....it can be done. But.....

We are still short every month by $300. We have no disposable income, yet the UST figured us to have $1700 every month

This is a bit extreme, you and trustee have numbers $2,000 apart. Something is seriously wrong somewhere, not just over-average utilities.

Like backtoschool suggested, if you post your exepense numbers folks who have survived UST presumptions can pick out red-flag items. Posting what the extra documentation was for will also help.

How about the front end; are you and the UST coming up with the same monthly gross income?

Your lawyer should be all over this, stay on them. Finding out what the UST is objecting to is crucial.

Good luck with this, hope it works out for you!

Tom in Colo

[backtoschool]

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.

Please anyone chime in and clarify this? 'Hub

Yes I agree 'Hub. The OP will have to file an amended expense schedule with tweaked numbers to defend the petition. I was wanting the OP to post the expenses here so we can see what the possible red flags are.

[AngelinaCatHub]

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.

Please anyone chime in and clarify this? 'Hub

[backtoschool]

If you list your expenses here we can probably figure out what the US trustee saw as a red flag.

[scorpion35]

Hello,
We have filed a chapter 7. We received a 707B presumption of abuse statement from the UST. I just checked pacer and the UST has submitted a motion to dismiss our 7 based on abuse. We provided extra documentation relating to higher than allowed utilities, our kids sports etc. We are still short every month by $300. We have no disposable income, yet the UST figured us to have $1700 every month. I believe we have a good lawyer. What happens now? Has anyone else experienced this with a positive outcome???

Thanks.

talk to your attorney and fight back
did u receive the 707B before or after your 341?

[cjsgac]

Hello,
We have filed a chapter 7. We received a 707B presumption of abuse statement from the UST. I just checked pacer and the UST has submitted a motion to dismiss our 7 based on abuse. We provided extra documentation relating to higher than allowed utilities, our kids sports etc. We are still short every month by $300. We have no disposable income, yet the UST figured us to have $1700 every month. I believe we have a good lawyer. What happens now? Has anyone else experienced this with a positive outcome???

Thanks.