THE ECONOMIC DIMENSION
Should debtors with older vehicles be allowed to take an additional deduction for operating expenses? Explain.
THE CULTURAL DIMENSION
What argument might be made in favor of allowing a debtor who lives outside an area with mass transit to claim a deduction in the “Ownership Costs” category for a car that he or she owns free and clear?
Ransom filed a petition in a federal bankruptcy court to declare bankruptcy under Chapter 13. Among his assets, Ransom reported a Toyota Camry that he owned free of any debt. In listing monthly expenses for the means test, he claimed a car- ownership deduction of $ 471 and a separate $ 388 deduction for car- operating costs. Based on his means- test calculations, Ransom proposed a five- year plan that would repay about 25 percent of his unsecured debt.