Ransom v. FIA Card Services, N.A.

Supreme Court Ruling on whether owned auto can be deducted on means test for above-income chapter 13 debtor.


The Supreme Court of the United States has decided its long-awaited decision whether a high-income chapter 13 debtor could deduct an "ownership expense" on the means test for an automobile that was owned and did not have a monthly loan payment associated with it. Ransom v. FIA Card Services, N.A. This will affect how much a chapter 13 debtor will have to pay in a chapter 13 plan, and will increase the amount for those who own a car outright and without a loan. It is suspected that this may cause potential chapter 13 debtors to incur an auto loan before filing to take advantage of the deduction that the Supreme Court now says is not available for those without a monthly payment. by George E. Bourguignon, Jr., bankruptcy attorney

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Reference Info:Decision | Federal, U.S. Supreme Court | United States

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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