Westland, MI asked in Bankruptcy for Michigan

Q: I have 11 months left on a chapter 13. Confirmed in August 2016. Lawyer now wants bonus statements from 2016 thru now.

I explained they were not separate checks. I have given my tax returns each year of the bankruptcy. To the trustee and lawyer. Why now would the lawyer want pay statements reflecting bonuses? I am current on all payments, it comes directly from my company to trustee. Just confused since it was included in yearly wages. Thank you

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2 Lawyer Answers
Lloyd M. Nolan
Lloyd M. Nolan

A: In our District, the Court and the Chapter 13 Trustee require that the debtor pay a portion of all bonuses received into their Chapter 13 Plan. Bonuses are additional income and the debtor is required to use his or her "best efforts" to fund the Chapter 13 Plan and pay a meaningful amount. If a debtor is allowed to keep all of his or her bonuses, the debtor is not making his or her "best efforts" to pay from the resources they have at hand. Contact your lawyer for a more precise explanation regarding the procedures and requirements in your jurisdiction.

Trent Harris
Trent Harris
  • Bankruptcy Lawyer
  • Jackson, MI
  • Licensed in Michigan

A: Your lawyer probably just wants documentation because it’s been requested by the trustee. There is no reason not to get that documentation and give it to your lawyer and trustee. It would be best to follow your lawyer’s advice, and work directly with your lawyer regarding any follow up questions.

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