Debtors can now make their chapter 13 plan payments in EDKY online (for a fee) through www.TFSbillpay.com (“TFS”). Debtors’ attorneys, here is what you need to know about this new service.
First, payment by payroll deduction is still required by KYEB-LBR 3070-1, unless otherwise ordered by the court or agreed to by the trustee.
I generally agree to waive the payroll deduction requirement for debtors who: do not receive regular income from wages; have seasonal employment; work part-time and don’t earn enough to cover the plan payment; or change jobs often.
Even if a debtor is making regular plan payments by payroll deduction, payments for tax refunds, bonuses, other lump-sum payments, or to catch up delinquent plan payments will not be made by payroll deduction.
In all of those instances, debtors might prefer to make online payment via TFS rather than paying by check, money order, or ACH bank draft. Some of the benefits of using TFS:
- The fee for using TFS is comparable to or cheaper than sending bank checks or money orders by mail. The fee is based on the amount of the debtor’s plan payment and generally ranges from $1 to $9. It’s definitely cheaper than sending a payment via overnight mail to try and avoid a probation dismissal.
- TFS keeps accurate records of the debtor’s chapter 13 plan payments so they don’t have to worry about keeping money order receipts or searching for cancelled checks to show they made their plan payments if I file a motion to dismiss.
- TFS gives debtors more flexibility in scheduling their payments so they don’t have to choose either the 10th or the 25th as the date on which their payment will be deducted from their bank account via ACH.
- TFS offers customer service options such as text or email reminders when plan payments are due, or the ability to stop or change a scheduled online payment by phone.
- Debtors can use TFS to make payments through any MoneyGram location (a flat $9 fee), so they don’t even need a bank account.
- TFS has an attorney portal (http://attorney.tfsbillpay.com), so attorneys can help their clients get set up with TFS, access clients’ TFS payment histories, and even request alerts to make sure their clients are staying on track.
TFS might not work for everyone, but it is an option for debtors who want it.
The Chapter 13 Trustee’s office has contracted with TFS to provide an online payment option but otherwise is not affiliated with TFS and does not receive any compensation from TFS for the use of its services. The website www.TFSBillPay.com is not hosted by the Trustee’s office. Contact TFS for website support.