[CNYBBA-LISTSERV] Congressional Reaction

[Mary Fangio]

Boy they got on that right away.  I thought that they would.  That 1998
law that allowed tithing was really "precious in their sight".  It's had
to tell a person that they have to choose between bankruptcy relief and
going to hell. I have several clients who actually tithe (as opposed to
someone who only got religion to shield some income--those people really
are going to hell (at least in my worthless opinion)),  and feel really
strongly about it.  The real problem comes when---- (and I currently
have this problem) if they continue to tithe they don't have a viable
Chapter 13 that will allow them to keep their house.  Even low income
debtors tithe and its important to them.  

AS Chapter 7 Trustee I always ask for proof that they "actually" tithe
and I have invariably actually gotten it from the church or by canceled
checks.  The people who put that down have been honest at least in my
experience.

Mary Fangio

-----Original Message-----
From: cnybba-bounces at cnybba.org [mailto:cnybba-bounces at cnybba.org] On
Behalf Of Lynn Harper Wilson
Sent: Monday, September 18, 2006 12:12 PM
To: cnybba at cnybba.org
Subject: [CNYBBA-LISTSERV] Congressional Reaction


Here is something forwarded by Mark.  Looks like Diagostino got
somebody's attention ... Lynn

***************************************
Lynn Harper Wilson, Staff Attorney
Standing Chapter 12 & 13 Trustee's Office
Syracuse, New York
    e-mail: lhwilson at cnytrustee.com
        web site: http://www.cnytrustee.com 



-----Original Message-----
From: hank hildebrand 
Sent: Saturday, September 16, 2006 10:45 PM
To: NACTT Trustee
Subject: [trustee-mail] Congressional Reaction

Note the letter that was sent Friday to the attorney general from
Senators Grassley, Hatch and Sessions.  Please read carefully the
directive that our senators request the attorney general to take:

September 15, 2006 

The Honorable Alberto Gonzales United States Attorney General United
States Department of Justice 950 Pennsylvania Avenue, NW Washington, DC
20530 

Dear Attorney General Gonzales: 

We would like to bring to your attention a bankruptcy case recently
decided in New York, In re Diagostino, No. 06-10384, 2006 WL 2578172
(Bankr. N.D.N.Y. Aug. 28, 2006), which we believe inaccurately
interprets how tithes are to be treated under the bankruptcy laws. In
Diagostino, the court ruled that above-median income debtors in Chapter
13 repayment plans cannot deduct charitable contributions when
calculating their disposable income under the means test. This case
arose because a trustee objected to the inclusion of tithing in a
proposed repayment plan. 

We believe that this court decision was wrongly decided and runs counter
to Congressional intent behind the Religious Liberty and Charitable
Donation Protection Act of 1998 (PL 105-183) and the Bankruptcy Abuse
Prevention and Consumer Protection Act of 2005 (PL 109-8). Because the
Department of Justice has plenary authority over Chapter 13 trustees
under Chapter 4 of the United States Trustee Manual, we ask that the
Department of Justice specifically direct Chapter 13 trustees - the
private parties who oversee repayment plans - not to object to the
inclusion of reasonable charitable contributions in a repayment plan if
the contribution at issue meets the requirements of Section 4 of PL
105-183. 

For people of faith in America, the obligation to tithe presents a
significant part of the free exercise of religion, which is guaranteed
to all Americans under the First Amendment. In fact, Congress has acted
to protect the exercise of religion from encroachment by bankruptcy
courts and trustees. Congress enacted the Religious Liberty and
Charitable Donation Protection Act of 1998 to specifically protect
tithing in the context of bankruptcy law. Consequently, trustees may no
longer demand that churches "refund" tithes to the bankruptcy courts.
Similarly, debtors have a statutory right to include tithes in repayment
plans under Section 4 of that law. In addition, nothing in the
Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 was
intended to change this right to allow tithes in a bankruptcy repayment
plan. As the lead sponsors of both these important bankruptcy statutes,
we can assure you that Congress never intended to exclude reasonable
tithing in bankruptcy repayment plans. 

The Department of Justice has the power to remove this obstacle that has
presented itself in this misguided interpretation of the bankruptcy
laws. We urge the Department to file court papers in appropriate cases
to correct this misinterpretation, as well as issue mandatory guidance
to Chapter 13 trustees so that they not object to reasonable charitable
contributions in Chapter 13 repayment plans. 

Sincerely, 

Chuck Grassley Orrin Hatch Jeff Sessions 

cc: Acting Director Clifford J. White, III, Executive Office for U.S.
Trustees. 



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