Bankruptcy law changes rapidly!  The following are mandatory changes in Bankruptcy Law:

0. Allowable Living Expense figures.

The IRS has notified us that on March 1, 2008, they will issue revised Allowable Living Expense figures for purposes of federal tax administration.  Assuming the IRS releases the data as scheduled on March 1, the updated IRS figures will be posted to the U.S. Trustee Program website on March 3, 2008.  The U.S. Trustee Program will apply the updated data to all bankruptcy cases filed on or after March 17, 2008

1. Census Bureau, IRS Data and Administrative Expenses Multipliers, February 1, 2008

In Part III of Bankruptcy Form 22A and Part II of Bankruptcy Form 22C, debtors are instructed to enter the “Applicable median family income.” This information is published by the Census Bureau according to State and family size, and the data is updated each year. In addition, pursuant to 11 U.S.C. § 101(39A)(B), the data will be further adjusted early each calendar year based upon the Consumer Price Index for All Urban Consumers (CPI).

Median Family Income in 2006 Inflation Adjusted Dollars Based on State/Territory and Family Size (CPI adjusted in January 2008)

2. Upcoming CPI Adjustments and IRS 2007 Expense Standards

Attached for your reference is a copy of the Notice issued by the Judicial Conference regarding its Revision of Certain Dollar Amounts in the Bankruptcy Code Prescribed Under Section 104(b) of the Code.  This is the adjustment every 3 years made using a specified CPI %.  Form 22 was left out of the attached notice, but it too will be amended to adjust dollar amounts contained in section 707 of the Bankruptcy Code. The effective date of the new dollar amounts is cases filed on or after April 1, 2007.

The footnote* on page: 

http://www.usdoj.gov/ust/eo/bapcpa/20070201/bci_data/median_income_table.htm 

will change to:

  * For cases filed on or before March 31, 2007, add $6,300 for each individual in excess of 4. For cases filed on or after April 1, 2007, add $6,900 for each individual in excess of 4. 

Also, the latest update we received from the IRS is that they estimate that the 2007 expense Standards will be published by the IRS effective before the end of April, 2007.  Once we receive an official publication date from the IRS, we will communicate anticipated posting and effective dates with respective to bankruptcy filings.

3. More Changes.  And, in addition to the changes in Forms 6E and 10 announced in the Federal Register, and the changes in Forms 22A and 22C there will be two other forms changes on April 1.  The $125,000 checkbox at the upper right corner of Form 6C and the $5,000 figure in question 3.b. on Form 7 also will be adjusted to incorporate the new dollar amounts.  Incidentally, the changes on Form 22A are on lines 38 and 52.  The change on Form 22C is on line 43.

Copies of the revised forms will be posted on the bankruptcy forms pending amendment page at http://www.uscourts.gov/bankform/index.html the next few days.

And, add one more form change. In the chapter 11 box at the bottom of page one of Form 1, $2 million becomes $2,190,000.