Kentucky Chapter 13 Calculation of Your Disposable Income is a formula used to determine how much of your income is available to be used for repayment of debt under Chapter 13 bankruptcy. This calculation is used to determine the amount of money that can be used towards paying back creditors in a Chapter 13 repayment plan. The two main types of Kentucky Chapter 13 Calculation of Your Disposable Income are the Allowable Expenses Method and the Means Test Method. The Allowable Expenses Method subtracts certain allowed expenses from your gross income to determine your disposable income. These expenses include basic living expenses such as housing, food, transportation, healthcare, taxes, and other necessary costs. The Means Test Method is a more comprehensive approach to calculating disposable income. This method is based on the median income of the state and takes into account your income, expenses, assets, and liabilities. It is used to determine if you can afford to make payments under a Chapter 13 plan. No matter which method is used, the calculation of your disposable income will determine the amount of money you can pay towards creditors in a Chapter 13 repayment plan.
Kentucky Chapter 13 Calculation of Your Disposable Income
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How to fill out Kentucky Chapter 13 Calculation Of Your Disposable Income?
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§ 1325. In chapter 13, "disposable income" is income (other than child support payments received by the debtor) less amounts reasonably necessary for the maintenance or support of the debtor or dependents and less charitable contributions up to 15% of the debtor's gross income.
Your monthly disposable income is the minimum you'll pay to your non-priority unsecured creditors throughout the course of your Chapter 13 payment plan. Your disposable income is the amount that remains after deducting allowed living expenses and mandatory payments.
Take your monthly income and deduct living expenses, priority debt payments, and secured payments. The remaining amount is your disposable income. You'd are responsible to pay this amount to creditors each month.
In Chapter 13 bankruptcy, you must devote all of your disposable income to your Chapter 13 repayment plan. Through the plan, which lasts either three or five years, you pay 100% of certain debts and a portion of other types of debts.
When filing for Chapter 7 bankruptcy, you need to total up all of your regular monthly income and then deduct any expenses that the court requires. This will give you your disposable income.
Chapter 13 trustees get paid by taking a percentage of all amounts they distribute to creditors through your repayment plan. This percentage varies depending on where you live but can be up to 10%. In addition, you typically have to pay interest on secured claims you are paying off through your plan.