Chapter 13 Allowences...?

Question

My In-Laws are in the midst of having their home forclosed on them next week (have another question pertaining to that).

They have made plans to talk to a lawyer about filing a Chapter 13 to try and save their home. Our questions are:

1) In-Laws live on husbands retirement and SSI (there is a total of 4 in the home, two are minors)...is thisan acceptable form of income?

2) In-Laws haven't filed income taxes for the past 5 years, thinking that they didn't have to because it is SSI and Retirement (don't ask me....I think it's a mess). Will this be a problem, which I think it will be?

3) In-Laws have no "toys": i.e. ATV, RV, summer home, motorcycles. Have one old clunker of a car and as far as we know...no credit cards. The only thing is...they have 3 horses that besides the up keep (which is ridiculous) they also pay to board them. I think that this will be a problem. Am I right? They may not even disclose the horses to the lawyer. Will the courts figure this out?

How will the courts know about the horses, if the In-Laws do not disclose it?

Do the In-Laws dertermine what they would nned each month to live on, and what is left from that goes towards their debt? Or does the courts determine what they need each month to live on and pay to their debitors?

Answer 1

For starters, I should state I am NOT an attorney and have not read up on current bankruptcy law. Confirm anything I say before relying on it.

2) If SSI is the ONLY income in the household, it is not taxable so they shouldn't be required to file.

3) Unless they pay ALL the expenses for the horses in CASH. There is a paper trail and the court WILL find it. Even if they are paid in cash, you won't be able to hide FUTURE payments from the court. I doubt they will able to save the house and the horses.