At the August 28, 2009 meeting of creditors hearing Mrs. Walck testified that she was entitled to receive $100,000.00 in life insurance proceeds. The trustee told her she needed to remit those proceeds to the trustee and Mrs. Walck complied with the trustee’s request. On February 25, 2010 Mrs. Walck filed and Amended Schedule C seeking to exempt those funds pursuant to 11 U.S.C. 522(d)(11)(C).
The trustee objected to Mrs. Walck’s amendment as being untimely and on the basis that the funds were not reasonably necessary for her support as required by 11 U.S.C. Section 522(d)(11)(C).
As to the untimeliness of filing her amendment, the Court did not find that the amendment had been filed in bad faith or that it had caused any of the creditors to suffer prejudice.
In determining whether the insurance proceeds were reasonably necessary for a debtor’s support the Court enumerated the eleven factors to be considered pursuant to the Uniform Exemption Act: (1) debtor’s present and anticipated living expenses; (2) debtor’s present and anticipated income from all sources: (3) the age of the debtor and his or her dependents: (4) the health of the debtor and his or her dependant’s; (5) debtor’s ability to earn a living; (6) debtor’s job skills; (7) debtor’s other assets; (8) the liquidity of these other assets; (9) debtor’s ability to save for retirement; (10) the special needs of the debtor and his or her dependents; and (11) debtor’s continuing financial obligations, e.g., alimony or support payments.
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In this case the Court noted that Ms. Walck was sixty six (66) years old and employed as a housekeeper at a nursing home where she earned $1,684.00 per month. Per month she also received $1,010.00 in Social Security, $99.00 from her husband’s pension, and $300.00 per month from her daughter. She testified that she intended to stop working at age seventy and that when she stops working she will receive $1,600.00 per month in Social Security.
In concluding that Ms. Walck would need the insurance proceeds to fund her basic needs, the court stated that in August 2014 she would have total household income of $1999.00 per month. This lead the Court to conclude that the insurance proceeds would be needed to cover Ms. Walck’s future support.
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