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Means Test
Remember the Code is written for states with and without community property laws, income to the debtor in a community property state is income to both spouses. The Means Test backs out the amount the non-debtor-spoues uses for purposes other than the household - presumably debt service and perhaps more uses.
Sent from my iPhone - please excuse typos.
> On May 30, 2016, at 5:56 PM, Patrick Green pat@fitzgreenlaw.com [cdcbaa] wrote:
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> John:
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> This is a discussion that the Marks (Markus and Jesse) and I have been having.
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> 101(10A) definition of CMI uses the phrase income the debtor receives (or in a joint case the debtor and the debtors spouse receive) in both paragraph A and B. Thus CMI in its definition does not include the debtors spouse in a case not filed jointly.
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> The problem arises because 707(b)(7)(B) says that in a case that is not a joint case, CMI of the debtor spouse shall not be considered for purposes of subparagraph A if the debtor and the debtor spouse are separated under applicable bankruptcy law or the debtor and the debtor spouse are living separate and apart other than for the purpose of evading paragraph a and the debtor files a statement under penalty of perjury saying as much.
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> Thus 707(b)(7)(B) contradicts 101(10A). Both provisions were enacted at the same time and they must be reconciled. Canons of statutory construction require that that any interpretation must give meaning to both sections and not negate any part of either section.
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> If 707(b)(7)(B) trumps 101(10A), then the plain language of 101(10A) tor spouse receive) is judicially written out of the statute and has no meaning. This violates the canons of statutory construction, so that interpretation cannot valid. However, if one reads 707(b)(7)(B) to be a safe harbor for when a non-filing spouse's income cannot be included when only one spouse is filing, then it can coexist with 101(10A). From that follows that the nonfiling spouse's income that is used for household purposes must be included in CMI, but other income is not included. In other words we treat the nonfiling spouse as a roommate. In that way both 101(10A) and 707(b)(7)(B) can be reconciled without making the language in either of them superfluous.
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> If you have any questions or concerns, please contact me.
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> Pat
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> Patrick T. Green
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> Attorney at Law
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> Fitzgerald & Green, Attorneys at Law
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> 1010 E. Union St. Suite 206
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> Pasadena, CA 91106
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> Tel: (626) 449-8433
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> Fax: (626) 449-0565
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> pat@fitzgreenlaw.com
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> Sent: Sunday, May 29, 2016 7:38 PM
> To: cdcbaa@yahoogroups.com
> Subject: Re: [cdcbaa] Means Test
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> Thanks. That's what I thought but CMI seems to say you don't have to include the non-filing spouse. It seems pretty likely that all of the non-filing spouses income is "regular contributions" but still.
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> I'm trying to finish the Third Edition of my Summary of Bankruptcy Law. I need volunteers to review it and give me comments.
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> I thought you were supposed to be doing a concert tonight?
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The post was migrated from Yahoo.
Sometimes I feel like I am baited into these questions. I am starting to
believe I am a contrarian!
Since it is for book/academic purposes, I will give my technical analysis.
Even though you two are saying what appears to be exactly opposite
statements, you are both correct and here is why.
First, Jon says that hubby files chapter 7 alone. Wife's income is not
included in CMI for means test except for the portion of wife's income that
is used to pay regular household expenses. need volunteers to review it and give me comments.
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> I thought you were supposed to be doing a concert tonight?
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Sometimes I feel like I am baited into these questions. I am starting to believe I am a contrarian!Since it is for book/academic purposes, I will give my technical analysis. Even though you two are saying what appears to be exactly opposite statements, you are both correct and here is why.First, Jon says that hubby files chapter 7 alone. Wife's income is not included in CMI for means test except for the portion of wife's income that is used to pay regular household expenses. <- This is exactly what the code says!The way it is done is the way Mark said it: Spouses income is counted except for (1) withholding taxes; (2) student loans; (3) dso; and (4) debts for which only the spouse is liable and which do not benefit the debtor.The only way to reconcile these two is to consider that to the extent the wife's income is not for (1) withholding taxes; or (2) student loans; or (3) dso; or (4) debts for which only the spouse is liable and which do not benefit the debtor, then what is that income used for? The only option appears to be to pay for regular household expenses. The UST uses this assumption in forcing debtors to include nonfiling spouse income as income.Sincerely,Michael Avanesian, Esq.Avanesian Law Firm801 N. Brand Blvd., Suite #1130Glendale, CA 91203Tel: 818.276.2477 | Fax:818.208.4550
The post was migrated from Yahoo.
Not correct.
Non-filing spouse's income must be included unless they are
separated/living apart (and not just for the purpose of thwarting
the means test.
However, portions of the non-filing spouse's income may be EXCLUDED
under the marital adjustment.
The US Trustee guidelines lists the following as allowable
exclusions (according to them...for whatever that is worth):
* withholding taxes;
* student loan payments;
* prior support obligations;
* debt payments on which only the non-filing spouse is legally
liable and where the consideration for the loan exclusively
benefits the non-filing spouse. (Credit cards used to pay for
household expenses may not be deducted on Line 17).
The post was migrated from Yahoo.
I know the OUST policy and the case law is to not allow ownership deductions for cars that are paid in full. Will they actually move to dismiss a Chapter 7 case that passes the means test only when your take the ownership expense for a car paid in full.
TIA
Sina
I know the OUST policy and the case law is to not allow ownership deductions for cars that are paid in full. Will they actually move to dismiss a Chapter 7 case that passes the means test only when your take the ownership expense for a car paid in full.
TIA
Sina
The post was migrated from Yahoo.