                                                        FILED
                                                         APR 09 2014
 1                         ORDERED PUBL ED
                                       ISH
                                                     SUSAN M. SPRAUL, CLERK
                                                       U.S. BKCY. APP. PANEL
 2                                                     OF THE NINTH CIRCUIT

 3
                    UNITED STATES BANKRUPTCY APPELLATE PANEL
 4
                              OF THE NINTH CIRCUIT
 5
 6   In re:                         )     BAP No.    MT-13-1313-KuPaJu
                                    )
 7   MICHAEL J. LUEDTKE and         )     Bk. No.    13-60098
     KATHERINE L. LUEDTKE,          )
 8                                  )
                    Debtors.        )
 9   _______________________________)
                                    )
10   ROBERT G. DRUMMOND, Chapter 13 )
     Trustee,                       )
11                                  )
                    Appellant,      )
12                                  )
     v.                             )     OPINION
13                                  )
     MICHAEL J. LUEDTKE; KATHERINE )
14   L. LUEDTKE,                    )
                                    )
15                  Appellees.      )
     _______________________________)
16
                     Argued and Submitted on March 20, 2014
17                           at Pasadena, California
18                           Filed – April 9, 2014
19            Appeal from the United States Bankruptcy Court
                        for the District of Montana
20
      Honorable Ralph B. Kirscher, Chief Bankruptcy Judge, Presiding
21
22   Appearances:     Appellant Robert G. Drummond, Chapter 13 Trustee,
                      Pro Se; Edward Albert Murphy of Murphy Law
23                    Offices, PLLC, for Appellees Michael J. Luedtke
                      and Katherine L. Luedtke
24
25   Before: KURTZ, PAPPAS and JURY, Bankruptcy Judges.
26
27
28
 1                             INTRODUCTION
 2        Robert G. Drummond, chapter 131 Trustee, objected to
 3   confirmation of Michael and Katherine Luedtkes’ chapter 13 plan
 4   because, in calculating their disposable income for purposes of
 5   § 1325(b), the Luedtkes claimed as part of their monthly
 6   transportation expenses a $200 “older vehicle operating expense.”
 7   According to the trustee, this older vehicle operating expense is
 8   not part of the Internal Revenue Service’s (“IRS’s”) National
 9   Standards and Local Standards, which generally control what
10   expenses above-median-income debtors may claim, and there was no
11   other permissible basis for the Luedtkes to claim this expense.
12        The bankruptcy court overruled the trustee’s objection and
13   confirmed the Luedtkes’ chapter 13 plan.   The trustee has
14   appealed, contending that the court erred when it permitted the
15   debtors to claim the older vehicle operating expense.
16        Because we agree with the trustee that above-median-income
17   debtors cannot claim the $200 older vehicle operating expense, we
18   REVERSE and REMAND for further proceedings.
19                                  FACTS
20        The Luedtkes commenced their chapter 13 case in January 2013
21   and filed their proposed chapter 13 plan in February 2013.    To
22   fund their plan, the Luedtkes proposed to make payments of $150
23   per month for sixty months.   The trustee objected to the
24   Luedtkes’ proposed plan on the sole ground that, in calculating
25   their disposable income, the Luedtkes claimed not only the $472
26
27
          1
           Unless specified otherwise, all chapter and section
28   references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532.

                                      2
 1   standard vehicle operating expense allowed for above-median-
 2   income Montana debtors with two or more cars, but also an
 3   additional $200 “older vehicle operating expense.”    Because the
 4   Luedtkes improperly claimed the older vehicle operating expense,
 5   the trustee asserted, they had understated their disposable
 6   income by $200 per month and, hence, they had failed to commit
 7   all of their projected disposable income to fund their plan
 8   payments, as required by § 1325(b)(1)(B).
 9        In their response to the trustee’s objection, the Luedtkes
10   pointed out that one of their two automobiles was a 1993 Ford
11   Taurus with 118,000 miles on the odometer.    As a result, the
12   Luedtkes argued, they were entitled to claim the older vehicle
13   operating expense, in accordance with Chapter 8 of Part 5 of the
14   IRS’s Internal Revenue Manual (“IRM”).   Chapter 8 sets forth the
15   procedures IRS collection employees are directed “to follow when
16   considering a taxpayer’s proposal to compromise” tax liability.
17   IRM 5.8.1.1 (2013).   Part 5, Chapter 8, Section 5, of the IRM
18   explains how IRS collection employees should analyze a taxpayers’
19   financial condition for purposes of considering a taxpayer’s
20   compromise offer.   See IRM 5.8.4.3 (2013).   In relevant part,
21   this section of the IRM provides that, when a taxpayer owns an
22   automobile that is over six years old, or has mileage of at least
23   75,000 miles, “an additional monthly operating expense of $200
24   will generally be allowed . . . .”   IRM 5.8.5.22.3 (2013).
25        A person unfamiliar with the Bankruptcy Code, and
26
27
28

                                      3
 1   specifically with the 2005 amendments thereto,2 might be
 2   wondering why the IRM, an internal IRS procedures manual, has any
 3   relevance to the resolution of an issue regarding the Luedtkes’
 4   disposable income for chapter 13 plan confirmation purposes.    A
 5   short answer will suffice.   Before the enactment of the 2005
 6   Bankruptcy Code amendments, bankruptcy courts enjoyed a
 7   significant degree of discretion in determining what expenses
 8   should be considered reasonably necessary for chapter 13 plan
 9   confirmation purposes.   See Drummond v. Welsh (In re Welsh),
10   711 F.3d 1120, 1130 (9th Cir. 2013).   However, for above-median-
11   income debtors, the Bankruptcy Code as amended in 2005 constrains
12   bankruptcy court discretion on this issue by tying the
13   determination of reasonably necessary expenses for chapter 13
14   plan confirmation purposes to specific benchmarks, in relevant
15   part as follows:
16        The debtor's monthly expenses shall be the debtor's
          applicable monthly expense amounts specified under the
17        National Standards and Local Standards, and the
          debtor's actual monthly expenses for the categories
18        specified as Other Necessary Expenses issued by the
          Internal Revenue Service for the area in which the
19        debtor resides, as in effect on the date of the order
          for relief . . . .
20
21   § 707(b)(2)(A)(ii)(I) (emphasis added); see also § 1325(b).     In
22   short, the National Standards and Local Standards issued by the
23   IRS, also known as the IRS’s “Collection Financial Standards” and
24   as the “Allowable Living Expense (ALE) Standards,” see IRM
25   5.15.1.1 (2012) & 5.15.1.7 (2012), now largely control the
26
          2
27         The 2005 amendments are more formally known as the
     Bankruptcy Abuse Prevention and Consumer protection Act of 2005,
28   Pub.L. 109–8, April 20, 2005, 119 Stat. 23 (“BAPCPA”).

                                      4
 1   determination of what are reasonably necessary expenses for
 2   above-median-income debtors seeking to confirm chapter 13 plans.
 3        While they claim an older vehicle operating expense, the
 4   Luedtkes concede that it is not to be found in the IRS's
 5   Financial Analysis Handbook (IRM 5.15.1), the portion of the IRM
 6   which identifies, describes and interprets the IRS’s National
 7   Standards and Local Standards.    See IRM 5.15.1.1, 5.15.1.7 -
 8   5.15.1.10 (2012).    As described in the Financial Analysis
 9   Handbook, the National Standards and Local Standards consist of
10   expense tables that guide IRS revenue officers to assist them in
11   determining the financial condition of delinquent taxpayers,
12   which in turn is meant to facilitate their performance of all of
13   the collections procedures set forth in Part 5 of the IRM.    See
14   IRM 5.15.1.
15        Even though the older vehicle operating expense is not
16   mentioned in the National Standards, the Local Standards or in
17   the Financial Analysis Handbook, the Luedtkes assert that a broad
18   interpretation of the phrase “National Standards and Local
19   Standards . . . issued by the Internal Revenue Service” contained
20   in § 707(b)(2)(A)(ii)(I) should include the older vehicle
21   operating expense.
22        The bankruptcy court agreed with the Luedtkes.    The
23   bankruptcy court in essence held that the “use and incorporation”
24   of IRM Chapter 8 into the Collection Financial Standards,
25   particularly Chapter 8's $200 older vehicle operating expense,
26   was “not at odds” with § 707(b)(2)(A)(ii)(I) and that the older
27   vehicle operating expense should be considered part of the IRS’s
28   Collection Financial Standards.    The bankruptcy court explained

                                       5
 1   that its holding was a logical extension of the reasoning set
 2   forth in two Supreme Court cases, Ransom v. FIA Card Servs.,
 3   N.A., 131 S.Ct. 716 (2011), and Hamilton v. Lanning, 560 U.S. 505
 4   (2010).   The bankruptcy court further explained that its holding
 5   also was consistent with statements made in Ransom v. MBNA Am.
 6   Bank, N.A. (In re Ransom), 380 B.R. 799, 808 (9th Cir. BAP 2007),
 7   aff’d and partially adopted 577 F.3d 1026, 1031 (9th Cir. 2009),
 8   aff’d 131 S.Ct. 716, regarding the general propriety of older
 9   vehicle operating expense claims when determining the disposable
10   income of chapter 13 debtors.
11        On June 17, 2013, the bankruptcy court entered an order
12   overruling the trustee’s objection and a separate order
13   confirming the Luedtkes’ chapter 13 plan.   On July 1, 2013, the
14   trustee timely filed a notice of appeal.3
15
          3
16         While the trustee’s notice of appeal only explicitly
     referenced the order overruling his objection, all of the
17   trustee’s submissions in this appeal make it clear that he also
     is challenging the confirmation order entered on the same date.
18   Because we interpret notices of appeal liberally and because the
19   Luedtkes have not been prejudiced or mislead by the contents of
     the trustee’s notice of appeal, we will construe the notice of
20   appeal as covering both orders. See Greenpoint Mortg. Funding,
     Inc. v. Herrera (In re Herrera), 422 B.R. 698, 708 (9th Cir. BAP
21   2010), aff'd & adopted sub nom. Home Funds Direct v. Monroy
     (In re Monroy), 650 F.3d 1300 (9th Cir. 2011) (citing Munoz v.
22
     Small Bus. Admin., 644 F.2d 1361, 1364 (9th Cir. 1981)); see also
23   United States v. Arkison (In re Cascade Rds.), 34 F.3d 756,
     761-62 (9th Cir. 1994).
24
          In fact, while the bankruptcy court’s order confirming the
25   Luedtkes’ chapter 13 plan was a final and appealable order, see
26   United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 269
     (2010), its order overruling the trustee’s plan objection was an
27   interlocutory order because that order did not by itself fully
     and finally resolve the discrete issue before the bankruptcy
28                                                         continue...

                                      6
 1                               JURISDICTION
 2        The bankruptcy court had jurisdiction pursuant to 28 U.S.C.
 3   §§ 1334 and 157(b)(2)(L).   We have jurisdiction under 28 U.S.C.
 4   § 158.
 5                                  ISSUE
 6        Did the bankruptcy court err when it held that the older
 7   vehicle operating expense should be considered part of the IRS’s
 8   Collection Financial Standards for purposes of determining
 9   chapter 13 debtors’ disposable income?
10                          STANDARD OF REVIEW
11        The sole issue on appeal requires us to interpret the
12   Bankruptcy Code, which is a question of law we consider de novo.
13   See Samson v. W. Capital Partners (In re Blixseth), 454 B.R. 92,
14   96 (9th Cir. BAP 2011), aff'd & adopted 684 F.3d 865 (9th Cir.
15   2012).
16                                DISCUSSION
17   1.   Overview
18        When the trustee or an unsecured creditor objects to a
19   proposed chapter 13 plan, the bankruptcy court may not confirm
20   that plan unless the plan will pay the objecting creditor in full
21   or all of the debtors’ “projected disposable income” will be
22
          3
23         ...continue
     court – whether the Luedtkes’ proposed plan should be confirmed.
24   See generally Rosson v. Fitzgerald (In re Rosson), 545 F.3d 764,
     769 (9th Cir. 2008). Nor would this order by itself have
25   seriously affected the interests the trustee represents. See id.
26   at 769-70. As an interlocutory order leading up to the
     bankruptcy court’s confirmation order, the order overruling the
27   trustee’s objection merged into the confirmation order for
     appealability purposes. See Giesbrecht v. Fitzgerald (In re
28   Giesbrecht), 429 B.R. 682, 687 (9th Cir. BAP 2010).

                                      7
 1   committed to the payment of the debtors’ unsecured creditors
 2   during the course of the plan.   See § 1325(b)(1).   The debtors
 3   have the burden of proof on all plan confirmation issues.
 4   Drummond v. Welsh (In re Welsh), 465 B.R. 843, 847 (9th Cir. BAP
 5   2012), aff’d 711 F.3d 1120 (2013).
 6        To determine their projected disposable income, the debtors
 7   must first calculate their “disposable income,” which term is
 8   defined in the Bankruptcy Code as generally meaning the debtors’
 9   current monthly income, less their reasonably necessary expenses.
10   See § 1325(b)(2).   As indicated above, prior to BAPCPA, the
11   Bankruptcy Code afforded bankruptcy courts with substantial
12   discretion in determining debtors’ reasonably necessary expenses
13   in accordance with the particular circumstances presented in each
14   case.   See In re Welsh, 711 F.3d at 1130.   But BAPCPA replaced
15   this discretion with the “means test” – a formulaic and
16   mechanical method of assessing debtors’ ability to pay.    See id.
17   The means test is set forth in § 707(b)(2)(A)(ii) and is made
18   applicable to above-median-income debtors seeking to confirm
19   chapter 13 plans by § 1325(b)(3).    In relevant part, the means
20   test provides:
21        The debtor's monthly expenses shall be the debtor's
          applicable monthly expense amounts specified under the
22        National Standards and Local Standards, and the
          debtor's actual monthly expenses for the categories
23        specified as Other Necessary Expenses issued by the
          Internal Revenue Service for the area in which the
24        debtor resides, as in effect on the date of the order
          for relief . . . .
25
26   § 707(b)(2)(A)(ii)(I).
27        The National Standards and Local Standards referenced in the
28   statute are “tables that the IRS prepares listing standardized

                                      8
 1   expense amounts for basic necessities.”       See Ransom, 131 S.Ct. at
 2   722.       These standards largely control which expenses are
 3   considered reasonably necessary and, hence, may be subtracted
 4   from current monthly income in order to calculate the disposable
 5   income of above-median-income debtors.       See id.; see also
 6   In re Welsh, 711 F.3d at 1130.
 7   2.     Allowance Of The Older Vehicle Operating Expense In
            Calculating Disposable Income
 8
 9          There is substantial disagreement among courts regarding
10   whether the older vehicle operating expense should be allowed in
11   calculating the disposable income of above-median-income debtors.
12   Some courts have said that it can be allowed.4      Others have
13   disagreed.5
14          We believe that the plain meaning of the language in
15   § 707(b)(2)(A)(ii)(I) controls the resolution of this issue.      The
16   statutory text dictates that debtors’ monthly expenses under the
17   means test “shall be the debtor's applicable monthly expense
18   amounts specified under the National Standards and Local
19
20          4
           See, e.g., Babin v. Wilson (In re Wilson), 383 B.R. 729,
     734 (8th Cir. BAP 2008) (citing In re Ransom, 380 B.R. at 808);
21   In re Byrn, 410 B.R. 642, 650 (Bankr. D. Mont. 2008);
22   In re Howell, 366 B.R. 153, 158 (Bankr. D. Kan. 2007);
     In re Slusher, 359 B.R. 290, 310 (Bankr. D. Nev. 2007);
23   In re McGuire, 342 B.R. 608, 613-14 (Bankr. W.D. Mo. 2006);
     In re Oliver, 350 B.R. 294, 301 (Bankr. W.D. Tex. 2006);
24   In re Carlin, 348 B.R. 795, 798 (Bankr. D. Or. 2006);
     In re Barraza, 346 B.R. 724, 729 (Bankr. N.D. Tex. 2006).
25
            5
26         See, e.g., In re Sisler, 464 B.R. 705, 708-10 (Bankr. W.D.
     Va. 2012); In re Schultz, 463 B.R. 492, 498 (Bankr. W.D. Mo.
27   2011); In re Hargis, 451 B.R. 174, 178 (Bankr. D. Utah 2011);
     In re VanDyke, 450 B.R. 836, 843 (Bankr. C.D. Ill. 2011);
28   In re May, 390 B.R. 338, 349 n.13 (Bankr. S.D. Ohio 2008).

                                          9
 1   Standards . . .   issued by the Internal Revenue Service.”
 2   Because the Bankruptcy Code does not explain or define what
 3   constitutes the IRS’s National Standards and Local Standards, we
 4   necessarily must look at what the IRS has to say about the
 5   standards in the IRS’s Financial Analysis Handbook, IRM Part 5,
 6   Chapter 15, Section 1, in order to determine whether the older
 7   vehicle operating expense is included within those standards.
 8        The older vehicle operating expense is not set forth in the
 9   expense amount schedules identified in the IRS’s Financial
10   Analysis Handbook as the IRS’s National and Local Standards.    Nor
11   is it otherwise mentioned in the Financial Analysis Handbook,
12   which identifies, describes and interprets the National Standards
13   and Local Standards.   Instead, the older vehicle operating
14   expense is mentioned only in IRM Part 5, Chapter 8, which deals
15   with compromise proposals received from delinquent taxpayers.
16   While Chapter 8 explicitly references, incorporates and applies
17   the procedures set forth in Chapter 15, see IRM 5.8.5.1 (2008),
18   this incorporation is not reciprocal.   Nowhere in the Financial
19   Analysis Handbook, IRM Part 5, Chapter 15, Section 1, is there a
20   general incorporation of the procedures and policies set forth in
21   Chapter 8.   Nor did we find any specific reference, incorporation
22   or application of the older vehicle operating expense in the
23   Financial Analysis Handbook.
24        Accordingly, because the older vehicle operating expense is
25   not set forth or referenced in the National Standards, in the
26   Local Standards, or in the IRM commentary identifying and
27   interpreting those standards, it was improper for the bankruptcy
28   court to allow the older vehicle operating expense for purposes

                                     10
 1   of calculating the Luedtkes’ disposable income.
 2        If Congress had meant for bankruptcy courts to consider the
 3   entirety of IRS policy and procedure in determining which
 4   expenses should be considered reasonably necessary for disposable
 5   income purposes, Congress could have provided in the Code that a
 6   debtor’s monthly expenses shall be determined in the same manner
 7   that IRS collection employees determine allowable expenses for
 8   purposes of assessing a delinquent taxpayer’s ability to pay, or
 9   something along those lines.   Instead, § 707(b)(2)(A)(ii)(I)
10   focuses exclusively on the National Standards and Local
11   Standards.   Thus, anything beyond those standards, and the IRS’s
12   interpretation of those standards, is at odds with the Bankruptcy
13   Code.6
14
          6
15         In September 2013, the IRS revised the IRM section
     containing the older vehicle operating expense and renumbered
16   most of that section. The version of the older vehicle operating
     expense in effect at the time of the Luedtkes’ bankruptcy filing,
17   IRM 5.8.5.20.3 (2012), was worded somewhat differently than the
     current version of this expense, IRM 5.8.5.22.3 (2013), cited
18   earlier in this decision. Furthermore, other bankruptcy
19   decisions discussing the older vehicle operating expense, cited
     supra at nn. 4 & 5, indicate that this expense formerly was set
20   forth in yet other subsections of chapter 8, and once again with
     different wording. See, e.g., In re May, 390 B.R. 338, 349 n.13
21   (Bankr. S.D. Ohio 2008).
22
          The changes over time to the older vehicle operating expense
23   highlight another concern we have with the bankruptcy court’s
     decision to look beyond the National Standards, the Local
24   Standards and the Financial Analysis Handbook in deciding whether
     to allow the older vehicle operating expense. The entirety of
25   the IRM is subject to frequent change, without advance notice and
26   at the sole discretion of the IRS. See Keith M. Lundin & William
     H. Brown, CHAPTER 13 BANKRUPTCY, 4th Edition, § 476.1, at ¶¶ 15-21,
27   (Sec. Rev. May 24, 2011, www.Ch13online.com). Thus, the broader
     the amount of IRS policy and procedure that is considered
28                                                            continue...

                                     11
 1   3.   The Supreme Court’s Ransom Decision
 2        The bankruptcy court reasoned that its holding was
 3   consistent with Ransom, 131 S.Ct. 716.    We disagree.   Ransom held
 4   that above-median income debtors cannot claim automobile
 5   ownership expenses in the form of lease or loan payments, even
 6   though such expenses are included in the IRS’s Collection
 7   Financial Standards, when the debtors actually own their
 8   automobiles free and clear of any lease or loan obligations.    Id.
 9   at 725-26.   According to Ransom, its holding necessarily and
10   logically followed from the plain meaning of the word
11   “applicable” as used in § 707(b)(2)(A)(ii)(I).    Id. at 724.
12        Ransom further stated that its holding was bolstered by the
13   IRM’s interpretation of the National Standards and the Local
14   Standards.   Id. at 726.   In support of this point, and several
15   other times in its analysis, Ransom cited to and relied upon
16   language from the IRS’s Financial Analysis Handbook, IRM Part 5,
17   Chapter 15, Section 1.     See, e.g., Ransom, 131 S.Ct. at 725-26.
18   Ransom further stated that consideration of the IRS’s own
19   guidelines for interpreting the National Standards and the Local
20   Standards could be persuasive (but not controlling) authority for
21   determining how bankruptcy courts should apply the National
22   Standards and Local Standards in the process of calculating
23   disposable income, so long as those guidelines were not at odds
24   with the Bankruptcy Code.    See id. at 726 & n.7.   Ransom went on
25
26        6
           ...continue
27   relevant or persuasive in determining what constitutes disposable
     income, the more in flux bankruptcy court decisions will be, as
28   the IRS from time to time alters its policies and procedures.

                                       12
 1   to quote, with approval, the dissenting opinion in Hildebrand v.
 2   Kimbro (In re Kimbro), 389 B.R. 518, 533 (6th Cir. BAP 2008)
 3   (Fulton, J., dissenting), where it was observed that: “one cannot
 4   really ‘just look up’ dollar amounts in the tables without either
 5   referring to IRS guidelines for using the tables or imposing
 6   pre-existing assumptions about how [they] are to be navigated.”
 7        Thus, Ransom instructs that the Financial Analysis Handbook,
 8   IRM Part 5, Chapter 15, Section 1, may be relevant and even
 9   persuasive authority to the extent it helps interpret the
10   National Standards and Local Standards and to the extent it does
11   not conflict with the Bankruptcy Code.   But nothing in Ransom
12   supports the proposition that bankruptcy courts may look to other
13   aspects of IRS policy and procedure in order to interpret and
14   supplement the National Standards and Local Standards.    Once
15   again, we reiterate that the older vehicle operating expense is
16   not part of those standards nor is it referenced in the Financial
17   Analysis Handbook, which identifies, describes and interprets
18   these standards.   Rather, the older vehicle operating expense is
19   an additional expense that IRS collection employees may consider
20   in the process of assessing a taxpayer’s offer to compromise
21   delinquent tax liability.   See IRM 5.8.4.3, 5.8.5.22.3 (2013).
22        In sum, the Supreme Court’s Ransom decision does not support
23   the allowance of the older vehicle operating expense in
24   calculating disposable income.
25   4.   Hamilton v. Lanning
26        Nor is there anything in the Supreme Court’s decision in
27   Hamilton v. Lanning, 560 U.S. 505, to support this allowance
28   either.   Hamilton held that, notwithstanding the mechanical and

                                      13
 1   formulaic nature of the disposable income calculation under
 2   § 1325(b)(2) and (3), bankruptcy courts have discretion to
 3   consider “known or virtually certain changes” in the debtor’s
 4   income and expenses when determining projected disposable income
 5   under § 1325(b)(1).   See id. at 520, 524.
 6        The older vehicle operating expense is not a known or
 7   virtually certain change in the Luedtkes’ expenses.   It is merely
 8   a fixed expense allowance that IRS collection employees may
 9   consider permitting delinquent taxpayers to claim when weighing
10   compromise offers.    The Luedtkes presented no evidence that would
11   have permitted the bankruptcy court to infer that the Luedtkes
12   had actually incurred or were virtually certain to incur a change
13   in their transportation expenses as a result of the age or
14   mileage of their Ford Taurus.   Their argument for allowance of
15   the older vehicle operating expense rested solely on the contents
16   of IRM Part 5, Chapter 8, and on the fact that they owned an
17   older, high-mileage car.   In other words, on this record, unlike
18   in Hamilton, there is no evidence of an actual or virtually
19   certain change in the Luedtkes’ financial condition that would
20   have permitted the bankruptcy court to “project” the $200 older
21   vehicle operating expense as an additional expense of the
22   Luedtkes; rather, the bankruptcy court’s allowance of this
23   expense was nothing more nor less than an unwarranted
24   modification of the expense amounts set forth in the IRS’s
25   Collection Financial Standards.
26   5.   This Panel’s Ransom Decision
27        The bankruptcy court finally attempted to support its
28   allowance of the older vehicle operating expense by relying upon

                                       14
 1   the following from this Panel’s decision in In re Ransom:
 2        Numerous safeguards are in place to protect both
          debtors and creditors. Debtors who own old or high
 3        mileage cars “free and clear,” are entitled to an extra
          $200 per month operating expense. Also, a “free and
 4        clear” owner is not “stuck” with the vehicle operating
          expenses allowed under the IRS Standards. Section
 5        707(b)(2)(B) is also available for “above the median”
          Chapter 13 debtors. Section 707(b)(2)(B), allows
 6        additional expenses based on “special circumstances.”
 7   380 B.R. at 808 (emphasis added) (quoting In re Carlin, 348 B.R.
 8   795, 798 (Bankr. D. Or. 2006)).    Even though this portion of our
 9   Ransom decision later was adopted by the Ninth Circuit Court of
10   Appeals, and even though the passage suggests that bankruptcy
11   courts should allow the older vehicle operating expense, we are
12   not bound by this language.   The comments regarding the older
13   vehicle operating expense were not necessary to the determination
14   of the issue on appeal in that case – whether the debtor was
15   entitled to claim vehicle ownership expenses when he owned the
16   subject vehicle free and clear of any loan or lease obligations.
17   Furthermore, the Panel's opinion did not analyze the issue
18   presented in this appeal, nor did it consider the contrary
19   positions taken by courts considering this issue.   Under these
20   circumstances, the rule of stare decisis does not require us to
21   follow the comments in Ransom regarding the older vehicle
22   operating expense, and we decline to do so.   See Yarnall v.
23   Martinez (In re Martinez), 418 B.R. 347, 354 & n.12 (9th Cir. BAP
24   2009).
25        Based upon our statutory analysis, set forth above, we
26   conclude that allowance of the older vehicle operating expense is
27   at odds with § 707(b)(2)(A)(ii)(I).
28

                                       15
 1                              CONCLUSION
 2        For the reasons set forth above, we REVERSE the bankruptcy
 3   court’s order overruling the trustee’s plan confirmation
 4   objection and its order confirming the Luedtkes’ chapter 13 plan,
 5   and we REMAND for further proceedings consistent with this
 6   decision.
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