Are there limits to what a chapter 13 debtor can claim as a reasonable expense?
Yes. In the Detroit district, debtors must generally cease 401(k) contributions as well as 401(k) loan repayments while in chapter 13. Expenses such as high car payments, jet-ski payments, motorcycle payments, private school tuition, assistance to adult children may not be allowed as these may be considered luxury items by the Trustee and objected to unless you are offering 100% to your unsecured (credit card, medical bills, etc.) over 36 months. Charitable contributions (including tithes and offerings) will generally be allowed if the debtor in fact makes these contributions (the Trustee may wish to see proof such as a letter from your Church, Temple or whatever charity you contribute to).
Related Questions
- If I get accepted in a Creative Team, can I pay for another persons training for a given workshop, and then claim that expense out of the $5000 credit as a production expense later?
- Can attorneys’ fees be obtained from debtor in order to compensate the company for the expense of retaining an attorney to collect?
- Are there limits to what a chapter 13 debtor can claim as a reasonable expense?
