In Re Gregory A. Wilson, et ux., Debtors

Above-median Chapter 13 debtor may not claim an ownership expense deduction under section 707(b)(2)(A)(ii)(I) for an automobile the debtor owns outright.

Date of opinion: 3/14/08

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Owsley 2008 WL 868044 (Bankr.N.D.Tex.)

Plans - Recreational vehicle had to be necessary to support for payments thereon to be deductible by high-income Chapter 13 debtors.

The "secured debt" portion of the "means test" formula for calculating the reasonable, necessary expenses of above-median-income Chapter 13 debtors consists of two apparently independent subclauses, one of which allows debtors to deduct "amounts scheduled as contractually due" to secured creditors with no apparent requirement that the property on which such payments are due must be necessary to the support of the debtor or the debtor's dependents 11 U.S.C.A. 707(b)((2)(A)(iii)(I), and only the second of which, that authorizing a deduction for any "additional payments" on secured debts on which the debtor defaulted prepetition 707(b)((2)(A)(iii)(II), expressly requires any showing that the collateral is necessary to the support of the debtor or his/her dependents. Nonetheless, in order to avoid an absurd result, a bankruptcy court interpreted this "necessity to support" requirement as applying to both subclauses, so as to prevent above-median income Chapter 13 debtors from taking a deduction for their payments on a recreational vehicle absent a showing by the debtors that this recreational vehicle was necessary for the support of themselves or their dependents.

In re Hartwick,

The court held that you can deduct ownership expense even though the vehicle was free and clear of any liens.

Date of the decision: 10/13/06

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In re Vaccariello 375 BR 809

Non-dischargeable student loan debt payments may not be used to reduce the income under the means-test to determine abuse


Date of the decision: 8/22/07

In re Burden, Case No. 07-50366

Debtors could not claim "means test" deductions for payments on debts secured by two pieces of property they intend to surrender. In the absence of these deductions, the Debtors have sufficient disposable income to trigger the presumption of abuse under section 707(b)(2) of the Bankruptcy Code.

Date of the decision: 12/20/07

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In re Perrotta, 2007 BNH 042

Denying the United States Trustee’s motion to dismiss the debtor’s case under 11 U.S.C. § 707(b)(1) and (2) as the United States Trustee had not satisfied the requirements of 11 U.S.C. § 704(b)(1)(A) because she did not file a statement within ten days after the date of the first meeting of creditors indicating that the debtor’s case would be presumed to be an abuse under 11 U.S.C. § 707 but rather filed a statement within that time frame indicating only that she was unable to determine whether the debtor’s case would be presumed to be an abuse; permitting the United States Trustee to proceed with her motion to dismiss the debtor’s case under 11 U.S.C. § 707(b)(3) based on the totality of the circumstances.

Date of decision: 11/21/07

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