What is a “debtor-in-possession budget” in a Chapter 11 bankruptcy?

A debtor-in-possession budget is an approved spending plan that a debtor must adhere to while in a Chapter 11 bankruptcy. This budget is used to ensure the debtor is using their funds responsibly and efficiently and is an important part of the bankruptcy process for both the debtor and their creditors. A debtor-in-possession budget includes the debtor’s income, and expenses such as rent, utilities, food, and other necessary items. The budget may also outline any payments made to creditors. The debtor-in-possession budget should be flexible enough to allow the debtor to keep up with their regular living expenses while also allowing for contribution to the payment plan with creditors. It must be created with the help of a qualified attorney and adhere to the guidelines set by the courts in Utah. The budget must be approved and monitored by the court and is subject to change depending on the debtor’s financial circumstances. The goal of a debtor-in-possession budget is to help the debtor manage their funds while in bankruptcy to pay back their creditors as much as possible. This budget must be followed closely in order to ensure that the debtor does not fall into further debt and that their creditors receive a fair repayment. A qualified attorney in Utah can help create a debtor-in-possession budget tailored to the debtor’s individual financial situation.

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What is a “debtor-in-possession budget” in a Chapter 11 bankruptcy?

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