668 B.R. 479
Bankr. S.D. Ill.2025Background
- Michael and Michelle Rohwedder, debtors with above-median income, filed for Chapter 13 bankruptcy in the Southern District of Illinois on April 11, 2024.
- Debtors' bankruptcy means test calculations included a $300/month deduction for tobacco under "special circumstances" on Form 122C-2.
- The Trustee objected to confirmation of both the original and amended plans, asserting tobacco expenses are not a "special circumstance" under 11 U.S.C. § 707(b)(2)(B)(i).
- The Court ordered Debtors to provide specific documentation and sworn explanations to support their claimed deduction, but the information submitted was inadequate.
- The central dispute was whether tobacco expenditures can qualify as an allowable "special circumstance" deduction for above-median income debtors.
Issues
| Issue | Rohwedder (Debtors) Argument | Trustee Argument | Held (Court's Ruling) |
|---|---|---|---|
| Whether tobacco expenses qualify as "special circumstance" | $300/mo tobacco should be a reasonable, special deduction due to its necessity for lifestyle | Tobacco is not a necessary or special expense, does not meet statutory requirements | Tobacco deduction is improper and must be denied |
| Whether proper documentation was provided for the deduction | Provided some receipts and bank records for tobacco purchases | Documentation and sworn statement requirements not met | Submission was procedurally deficient and insufficient |
| Whether Congress/IRS intended to allow such expenses | Expenses are reasonable, not excessive for household size | Exclusion from means test was intentional by Congress/IRS | Expenditures are not special, unique, or unusual |
| Reliance on cited case law | Cited In re Andrick and In re Woodman for expenditure reasonableness | Distinguished those cases as factually different or not governing | Cited cases not controlling for above-median means test |
Key Cases Cited
- In re Early, 523 B.R. 804 (Bankr. S.D. Ill. 2014) (Discusses means test's application in determining disposable income in bankruptcy)
- In re Scott, 457 B.R. 740 (Bankr. S.D. Ill. 2011) (Affirms the means test should be applied mechanically for above-median income debtors)
- In re Harmon, 446 B.R. 721 (Bankr. E.D. Pa. 2011) (Reviews legislative intent behind special circumstances exception)