Did you have a luxurious Christmas?

Did you have a luxurious Christmas?

Before you laugh, you might want to consider the Bankruptcy Code definition of luxury purchases.

That would be more than $550 for luxury goods or services incurred within 90 days of filing a bankruptcy case. Alternatively, it can include cash advances aggregating $825 or more within 70 days of a bankruptcy filing.

“Luxury goods” would include most Christmas purchases, which are typically not necessary for anyone’s support or maintenance.

The bottom line is that non-essential credit card debt to any one creditor totaling $550 or made within 90 days of filing, or cash advances aggregating $825 are presumed non-dischargeable.

Which may mean that Christmas revelers might have to wait a while to file a case with the bankruptcy court.

 

By Doug Beaton

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