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§ 707(b)(2)

In re Lancaster

Ruling
Above-median debtors' case dismissed for abuse due to excessive disposable income.
Procedural posture

In this chapter 7 proceeding, the United States Trustee (UST) filed a Motion to Dismiss debtors' case for abuse under 11 U.S.C.S. § 707(b).

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Consumer opinion summary, case decided on February 03, 2011 , LexisNexis #0311-024

In re Willems

Ruling
U.S. Supreme Court decision in Ransom, applied retroactively to bar vehicle ownership deduction on vehicles owned free and clear in unconfirmed plans filed prior to the decision.
Procedural posture

A Chapter 13 trustee objected to confirmation of the debtors' plan on the grounds that an ownership deduction on a vehicle without a lien was impermissible under 11 U.S.C.S. § 707(b)(2)(A)(ii)(I). The sole issue for decision was whether a recent U.S. Supreme Court decision, Ransom, applied retroactively to unconfirmed plans filed prior to the decision.

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Consumer opinion summary, case decided on February 03, 2011 , LexisNexis #0211-125

In re Heinze

Ruling
Case ordered converted or dismissed for abuse due to understatement of disposable income.
Procedural posture

Bankruptcy debtors asserted that they had insufficient disposable income to repay creditors, but the bankruptcy trustee contended that the debtors claimed unwarranted dependents, and excessive cell phone expenses and tax liability, in calculating their disposable monthly income. The trustee moved to dismiss the debtors' case based on the presumption of abuse of chapter 7 bankruptcy under 11 U.S.C.S. § 707(b)(2).

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Consumer opinion summary, case decided on January 01, 2011 , LexisNexis #0211-061

In re Rieck

Ruling
Hypothetical chapter 13 administrative expense and expenses of four vehicles did not create special circumstances that would rebut presumption of abuse.
Procedural posture

Calculation of bankruptcy debtors' income and expenses indicated sufficient disposable income to raise the presumption of abuse of chapter 7 bankruptcy by the debtors under 11 U.S.C.S. § 707(b)(2). The U.S. Trustee moved to dismiss the debtors' bankruptcy case, but the debtors asserted that special circumstances existed to rebut the presumption of abuse.

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Consumer opinion summary, case decided on April 16, 2010 , LexisNexis #0610-128

In re Siler

Ruling
Debtor's retirement plan contributions and loan obligations did not constitute special circumstances that would rebut the presumption of abuse.
Procedural posture

Based on a bankruptcy debtor's projected disposable income, the debtor presumptively abused chapter 7 bankruptcy, but the debtor asserted that disallowed expenditures constituted special circumstances to rebut the presumption based on the debtor's retirement plan contributions, a plan loan obligation, and a student loan obligation. The bankruptcy administrator moved to dismiss the debtor's case.

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Consumer opinion summary, case decided on March 23, 2010 , LexisNexis #0610-100

In re Harris

Ruling
Debtor could not claim deduction for support of daughter's attending college.
Procedural posture

The debtors sought confirmation of their first modified chapter 13 plan. The trustee objected to confirmation on the grounds that the plan did not provide for all of the debtors' projected disposable income to be applied to make payments to unsecured creditors in compliance with 11 U.S.C.S. § 1325(b)(1)(B). The trustee's objection related specifically to a deduction taken on line 40 of the means test on Official Bankr. Form 22C.

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Consumer opinion summary, case decided on October 22, 2009 , LexisNexis #1109-089

In re Stallings

Ruling
Debtor properly claimed deductions in four vehicles which were not grounds for bad faith dismissal.
Procedural posture

Debtors filed a petition under chapter 13 and a plan for repaying their creditors. The chapter 13 trustee filed a motion to dismiss the debtors' case, claiming that the debtors did not file their plan in good faith because they claimed monthly expenses on four vehicles which they were not entitled to take.

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Consumer opinion summary, case decided on May 04, 2009 , LexisNexis #0709-057

In re Justice

Ruling
Case ordered reconverted to chapter 13 or dismissed for abuse due to income levels.
Procedural posture

The movant, a creditor, sought dismissal of the debtor's case. The matter was remanded from the district court for the District of Arkansas. The district court ruled that the bankruptcy court was required, when faced with an unrebutted presumption of abuse in the debtor's means test; to dismiss his petition or convert it back to a chapter 13.

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Consumer opinion summary, case decided on April 15, 2009 , LexisNexis #0709-018

In re Kafi

Ruling
Debtor could not claim vehicle expense under IRS standards but only actual expenses of vehicles owned free and clear.
Procedural posture

In calculating disposable income, a chapter 7 bankruptcy debtor claimed vehicle ownership expense deductions for vehicles for which the debtor made no loan or lease payments. The United States Trustee moved to dismiss the debtor's case, asserting that the claimed expenses were not allowable and that the debtor's proper disposable income created a presumption of chapter 7 bankruptcy abuse under 11 U.S.C.S. § 707(b)(2).

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Consumer opinion summary, case decided on March 12, 2009 , LexisNexis #0509-126

In re Reyes

Ruling
Debtor could not deduct secured debt payments on vehicle intended for surrender.
Procedural posture

The debtors sought confirmation of their proposed chapter 13 plan. The chapter 13 trustee objected to the debtors' calculation under 11 U.S.C.S. § 707(b)(2)(A)(iii) of a secured debt deduction attributable to a junior lien on the debtors' principal residence, which they intended to treat as unsecured and strip in conjunction with confirmation, and the amount of a vehicle ownership allowance claimed under the I.R.S.'s local standards.

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Consumer opinion summary, case decided on February 26, 2009 , LexisNexis #0409-084