Chapter 13 Plan Payments

plan payments kansas city

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One form of bankruptcy is a Chapter 13 bankruptcy.  This type of bankruptcy case is a voluntary repayment plan designed to repay certain creditors in order to retain property and eliminate debt.  The plan is reviewed and monitored by a court-appointed Chapter 13 Trustee.  The Trustee is responsible for distributing plan payments to the creditor according to the Plan.  The Debtor is responsible for making those payments each month for the plan to work.

Pay Secured Creditors

The plan payment is determined based on several factors.  First and foremost, the plan payment must be able to pay the secured creditors.  This could include mortgage payments, car loans, or other secured debts.  A Chapter 13 plan will allow a Debtor to retain real property and vehicles, but those assets must be paid for.

Tax Debt

Tax debt also must be paid in a Chapter 13 plan, so a plan payment must be sufficient to pay any tax debt the Debtor owes.  Child support arrearage can also be paid as a Chapter 13 debt, but that type of debt is often paid according to a State Court Order.


A Debtor’s income also factors into what must be paid as part of a Chapter 13 plan.  If the Court determines that a Debtor has disposable income, or the ability to repay additional debt, that will factor into the Chapter 13 plan payment.

Once the plan payment is confirmed, the Debtor has an obligation to make that payment each month to the Chapter 13 Trustee.  Doing so for the prescribed amount of time will allow a Debtor successfully to complete their Chapter 13 plan and achieve some financial stability.

For help with filing a bankruptcy, contact W M Law today.

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Jeffrey L. Wagoner


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