What Living Expenses Are Allowed Under a Chapter 13?

By Sienna Condy
What, Living Expenses, a Chapter

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In a Chapter 13 bankruptcy, your monthly payment to the court towards your outstanding debt is decided based on your income and the monthly living expenses the court deems allowable. Although you can logically guess at some living expenses, like housing, others might come as a surprise.

Food and Clothing

Food and Clothing

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Expenses for food, clothing, household supplies, personal care products and other miscellaneous items can be counted as a living expense under your Chapter 13 paperwork. However, the allowable amounts for these expenses are based on the Internal Revenue Service's National Standards, not your actual expenses. As of January 2010, the allowable total expense amount for these items for a family of four was $1,370 a month.

Housing and Utilities

Housing and Utilities

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Based on IRS local standards, not national standards, allowable housing and utility expenses are figured on state and county amounts and family size, not your actual expenses. Due to regional differences, standards vary by location and can range anywhere from around $700 a month to several thousand dollars a month.

Transportation Expenses

Transportation Expenses

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Transportation expenses, including bus passes, car payments, car insurance, gas and parking expenses, are typically considered allowable expenses due to the necessity of travel for employment. However, the amounts for transportation expenses are based on local standards which vary by state, county or metropolitan area. Typically, the bankruptcy court will only allow transportation expenses for one car per individual filing.

Other Allowable Expenses

Other Allowable Expenses

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The bankruptcy court allows certain other living expenses to be considered necessary to your continued financial and personal well-being. These expenses include: taxes, mandatory payroll deductions, life insurance, court-ordered payments, child care, health care, telecommunication services (like a cell phone), and educational expenses necessary for employment or for a mentally or physically challenged child.

About the Author

Sienna Condy began writing professionally in 2001 while attending the University of Cincinnati, and she's been at it ever since. Since graduating, she's written everything from marketing materials to articles on removing stains. Today, she enjoys writing about weddings, legal issues, science, health and parenting.

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