My Chapter 13 Plan is Confirmed, What Comes Next?

Now your plan is confirmed you still have to complete the plan.  In most cases there are five years of payments.  However, the five years runs from the filing of your case, not when it is confirmed.  So that finish line has gotten closer while we were negotiating with the Trustee over the payments.

You still have a way to go.  To get your discharge you need to complete the plan.  We understand that life happens.  If something bad happens, let us know.  There are options.  They may not be great options, but the options only get worse the longer you wait.  We may be able to lower the payments or even convert to a Chapter 7.  Sometimes we may even dismiss and start over.

Payments

Your first job is to make sure you stay current on your payments.  If you are waiting for the plan payments to come out of your paycheck don’t fall behind.  The best way to do this is to start making the payment that will come out of your paycheck.  If you are paid biweekly take the monthly payment by 12 months and divide by 26.  If you are paid weekly divide by 52 weeks.  On your payday check your pay advice.  If the payment hasn’t come out make the payment yourself.

Steps in Payments

Next take a look at your plan.  Take note of any steps in your plan.  You will want to make sure that the new amount is taken out when these increases happen.  Usually these increases are tied to a loan being paid directly being paid off.  If the increase isn’t coming out of your pay you need to send it until it does.

Tax Refunds and Returns

Check your plan to see if you need to turn over your tax refunds.  Look at section 3.5 of your plan.  If the box it checked you need to send your net refund and copy of your tax return to the Trustee each year.  You would think that if you have to turn over your tax return the Trustee would just take it.  That isn’t how it works.  You get the refund and it is your responsibility to send it in.   If you owe one return and get a refund on the other you get to use the refund to pay what you owe for that year.  If your refund on the one return is less than what you owe on the other return you just have to send your tax returns to the Trustee.  You can provide us with your returns and we will send them to the Trustee.  If you send them yourself remember to mail them to the Trustee’s Maryland address.  The PO Box they have in Tennessee is just for payments.

Case Closing

When you have made all your payments the Trustee will file a Notice of Completion of Plan Payments.  This will start the closing process.  It may take a few weeks for the payments coming out of your pay to stop so make sure you budget for this.  You will get the overpayments back, but it will take a few months.

Conclusion

If you have any questions or and issue come up give us a call or send an email.  Completing a Chapter 13 Plan requires a lot of discipline and some luck.  If you have a financial set back we should talk about it.  The options may not be great, but the options are better now then the will be if you wait.  Even if we have to dismiss and start over, better to do it when the problem arises then when you are another year into the case.

Remember we aren’t just your bankruptcy attorney. We are like your family doctor for legal issues. We can handle just about any legal matter you are likely to have. We handle everything from auto accidents, to wills, to real estate settlements. So if you have a friend or family member who needs any kind of legal help or advice, please feel free to refer them to us.

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