Question about time frame for US Trustee to file a Notice under 707(b)

[filed]

I think it is well settled amongst the moderators on this forum that there is a deadline by which the US Trustee must file their Notice of Presumption of Abuse under 707(b), and that deadline is at minimum 10 days from the conclusion of the 341.

I have also read in a couple of places that the deadline may have been extended (sometime in 2010, perhaps?) to 14 days, but, I have not seen evidence that supports this change from 10 to 14 days. Can anyone out there share definitively whether it's 10 days or 14 days?

I realize 4 days may not be of much significance, but, as my deadline is upcoming, it could mean a couple days earlier of getting some much needed peaceful sleep.

[IamOld]

:-( I believe it is 14 days...

[ValleYum]

I think it is 14 as well.

We had a forum member here be notified on day 13 and she later said (in the 3 Deadlines to Sweat out after your 341 Sticky - that he was within the time frame).

Here is her post for your reference:

http://www.bkforum.com/showthread.php?66878-Statement-and-notice-of-presumed-abuse...please-help!&p=491176#post491176

I, too, have recently looked for documentation of this change and wasn't able to find it on the net.

I am so sorry if this means your tummy is going to twist for another 4 business days, filed. You need to try to relax though because as of this moment - there is nothing you can do. It is one of those darn "it is what it is" things. I know, I know, easier said than done! I cleaned out closets and started a purge for my upcoming Fresh Start by also getting a pile of items going for a yard sale! Hang in there - we are all here for you!! {{{hugs}}}

[filed]

Thanks ValleYum,
I actually realize there is nothing more I can do, which, oddly, is why I think this is so bothersome. I am not used to just sitting and waiting for something, my proclivity is to do something about what is bothersome-rather than ignore it.
Reading and communicating on this forum is very helpful, and I am grateful for all of the talented and kind participants who share their goodwill, knowledge and experience.

[justbroke]

I was actually wrong in the prior post. Congress did authorize changes to 11 USC 704(b)(1) which is where the UST has a limited time to file a motion for abuse. However, Congress only changed 11 US 704(b)(1)(B)! That changed the 5-day rule to a 7-day rule. The Congressional change did not modify the 11 USC 704(b)(1)(A) part of the law regarding the 10-days that the Trustee has to file a notice that they find the case to be an abuse.

I think we all need to remember, that the UST always has the ace card which is 11 USC 707(b)(3) under totality of circumstances. They have until the last day to file a complaint regarding dischargeability. If the UST is interested in your case, they are interested in your case. The presumption of abuse dismissal is easier for the UST since they can do that by motion and quickly The other is done by complaint which is a mini-lawsuit within the bankruptcy.

[IamOld]

So justbroke we do then need to sweat until the 60 days are up???

[justbroke]

So justbroke we do then need to sweat until the 60 days are up???

You would already know if it was an issue. The UST typically isn't that secretive when it comes to 707(b)(3) complaints. The UST would have requested more paperwork or eluded to the fact that they oppose your discharge. One typically knows the UST's position on a case by, at, or shortly after the 341 Meeting. The 10-day period for the UST to file a notice of presumption of abuse is a pretty good bar.

There are very few cases where the UST uses the entire 60-day window to file a complaint for dismissal under 707(b)(3). Again, you should already know if the UST is looking at that angle.

[IamOld]

:-) Thanks justbroke!!!

[filed]

...I think we all need to remember, that the UST always has the ace card which is 11 USC 707(b)(3) under totality of circumstances. They have until the last day to file a complaint regarding dischargeability. If the UST is interested in your case, they are interested in your case. The presumption of abuse dismissal is easier for the UST since they can do that by motion and quickly The other is done by complaint which is a mini-lawsuit within the bankruptcy.

I am sure you are correct, and they can make a complaint based on 707(b)(3) anytime within the 60 days. Am I naive in believing or thinking that the US Trustee is likely to review the documents they requested of me and within the 10 day window make an actual determination of whether my case is problematic or not?

If it is normal for them to conduct their review withing the 10 day timeframe, then, once that is up aren't we usually in the clear with regard to 707(b)(3) concerns as well?

What can possibly transpire after the first 10 days but before the 60 days that would make them decide to try to dismiss for 707(b)(3) that they did not already know within the first 10 days since they obtained all the documentation they requested?
Thanks!

[justbroke]

Of course, I was nervous up to day 60 in my Chapter 7 case! Do as I say... not as I do!

[filed]

... The 10-day period for the UST to file a notice of presumption of abuse is a pretty good bar.

There are very few cases where the UST uses the entire 60-day window to file a complaint for dismissal under 707(b)(3). Again, you should already know if the UST is looking at that angle.

Thanks Justbroke. The US Trustee requested documentation from me and asked questions at my 341. According to my attorney, I answered all questions thoroughly and appropriately. He said this was definitely the end of it. I am just wanting to know if the 10 day hurdle actually has some meaning, and that if the US Trustee still had a problem with my case after the answers and documents I provided, I would know about it sooner, rather than having to wait the full 60 days.

[justbroke]

I am sure you are correct, and they can make a complaint based on 707(b)(3) anytime within the 60 days. Am I naive in believing or thinking that the US Trustee is likely to review the documents they requested of me and within the 10 day window make an actual determination of whether my case is problematic or not?

This review is actually pretty quick. They use a special spreadsheet which takes your numbers compared to THEIR numbers! Remember, they had at LEAST 30 days before your 341 Meeting and then another 10 days to file this! Typically, the UST already knows before the 341 Meeting and that is why they show up at the 341 Meeting -- to ask you questions under oath. It's all math to them.

If it is normal for them to conduct their review withing the 10 day timeframe, then, once that is up aren't we usually in the clear with regard to 707(b)(3) concerns as well?

They are typically done before the 341 Meeting for an abuse under the Means Test (11 USC 707(b)(2)).

What can possibly transpire after the first 10 days but before the 60 days that would make them decide to try to dismiss for 707(b)(3) that they did not already know within the first 10 days since they obtained all the documentation they requested?
Thanks!

It's complex. You usually don't need to worry about 707(b)(3) unless you're over the median or have other "special circumstances". A "special circumstance" could be that you were unemployed for 8 months, then got a job making $100K with IBM the month before filing! (True story!) However, the UST typically doesn't bother if you were under the median -- under the radar. The review is typically "superficial" for under-the-median income filers with a good Schedule I/J.

I think I'm finding fewer 11 USC 707(b)(2) "abuse" filings by the UST these days. The USTs were complaining about all over-the-median income filers who claimed things like a second mortgage (or even first mortgage) on a property that they were going to surrender! However, the means test allows it, and caselaw pretty much has settled that. So, you don't get the "automatic" abuse filing by the UST these days in most Districts.

Remember, the UST's job is to make sure only those who are deserving and needy get a Chapter 7 discharge. It is actually the UST's job to push people into Chapter 13 or dismiss if they don't fit the criteria. It's that simple.

[ValleYum]

So, JB?? Will you please use your Mod powers and go back into that Sticky (3 deadlines to sweat out after your 341) and edit the 14 days back to 10 days? When we had discussed it before, I had PMed Miss AngelinaCat and asked her to update it after those earlier posts we referenced. Thank you much!!

[filed]

I think I'm finding fewer 11 USC 707(b)(2) "abuse" filings by the UST these days. The USTs were complaining about all over-the-median income filers who claimed things like a second mortgage (or even first mortgage) on a property that they were going to surrender! However, the means test allows it, and caselaw pretty much has settled that. So, you don't get the "automatic" abuse filing by the UST these days in most Districts.

I thought I read in Jonathan Alper's blog (or maybe somewhere else) that the US Trustees are now NOT allowing you to use mortgage payments (first or second) on a home that you are surrendering? Are you saying that case law is settled that a debtor CAN use first and second mortgage payments on their home for purposes of the means test even if they are surrendering the home?

[justbroke]

I thought I read in Jonathan Alper's blog (or maybe somewhere else) that the US Trustees are now NOT allowing you to use mortgage payments (first or second) on a home that you are surrendering? Are you saying that case law is settled that a debtor CAN use first and second mortgage payments on their home for purposes of the means test even if they are surrendering the home?

This is the fun -- or not so fun -- part about caselaw. The caselaw (appellate in most Circuits) is now pretty consistent that on the Means Test you can claim any secured payments that you are actually surrendering. When it comes to Schedule J, the caselaw differs with the majority of States/Districts finding that you can not claim the secured payments on your Schedule J if you are surrendering.

It's confusing, but it's two different things. The Means Test is just the first hurdle, as I like to say. The second test is whether it's an abuse or there are special circumstances. The UST has been shutdown on attacking the Means Test by stating that it's an abuse because the debtor(s) claimed an expense for a secured item that they are keeping. The USTs have learned through a lot of trial and error, and now good caselaw on this, that the proper thing to attack is not the Means Test. The USTs now properly attack those cases through a complaint to disallow the discharge under 11 USC 707(b)(3)(B) Totality of Circumstances.

I know it's confusing... but Means Test and Schedule J are looking at two different things. Means Test looks backwards and Schedule J looks "forward".