I received a Statement of Presumed abuse after filing for chapter 7 in the eastern district of Michigan. What can I do

Asked over 4 years ago - Wyandotte, MI

It states violations in sec 704 A and B. I went over the income guidelines because before filing and trying to save myself I took out a early withdrawal in the form of a one time payment from my very small 401k. That put me over the limit for income by a couple thousand dollars? Are there things I can do to get the chapter 7 through and is there a timeline I'm working with?

Attorney answers (3)

  1. Ralph M. Reisinger

    Contributor Level 9

    Answered . I assume you acted as your own attorney. At this point you can stipulate to dismiss the case and refile after your income has dropped below the median, you can convert to a Chapter 13, or you can respond to the Trustees motion and explain that your income is not over median but that you included the 401k withdrawal, a one time event, in your median income and that is not evicence of abuse. If you used an attorney to file they should be addressing this for you.

  2. Clinton J. Hubbell

    Contributor Level 8

    Answered . When you recieve a Motion to Dismiss from the United States Trustee, that motion is based on a presumption of abuse. Legal presumptions in bankruptcy, as in most other areas of the law, can be rebutted. There are circumstances that may rebut the presumption of abuse. If the presumption of abuse is rebutted, it is within the discretion of the judge whether to dismiss the case.

    If you hired an attorney, he or she was required to give you a written fee agreement detailing the scope of the representation. Read that fee agreement, and find out whether answers to motions to dismiss for a presumption of abuse are covered, and if they are, your attorney should handle the response.

  3. David E. Tovarez

    Contributor Level 10

    Answered . You need to discuss with you attorney and determine the appropriate response.

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