A Scrooge of a bill
Gina, it's time for another "Bah Humbug" award. Here's a vivid example of why reading the fine print is essential:
Earlier this year, a New York couple filed for bankruptcy. Under the 2005 bankruptcy “reforms” so-called, people at this couple’s income level are required to come up with a court-approved plan to partly repay their creditors. As part of the requirement, the couple listed their monthly expenses to determine how much they could afford to pay their creditors.
Among the expenses listed was $100 a month the couple tithed to their church. When the bankruptcy trustee objected that this wasn’t the kind of “reasonably necessary” expense the most recent “reforms” intended, the issue went before a federal bankruptcy judge.
In his ruling, Judge Robert Littlefield wrote that the 2005 “reforms” “effectively closed the door for debtors” like the New York couple from making charitable contributions. By “closing the door” the judge was referring to the ironic fact that prior to the 2005 “reforms,” regular contributions to churches and charities were specifically permitted under bankruptcy law.
It was the so-called “reforms” of 2005 that created what Littlefield called an “awkward, bifurcated Congressional framework which makes charitable giving easier for some debtors and not others.” Littlefield all but called on Congress to amend the law.
Well, so much for spiritual convictions, and so much for "separation of church and state." Read the rest of today's "BreakPoint" commentary, find out how you can remedy this problem, and share your thoughts here.