If one has a significant increase in salary three years into a 5 year chapter 13 bankruptcy, can the amount owed to the creditors increase?

You betcha! That is why you should be submitting a new budget (Schedules I and J) before the Trustee gets wind of the income increase and demands all of the increased income.

In the federal districts where I practice, a Plan must last the statutory 36 or 60 months, and must include all your disposable income. So unless you are going to pay the trustee 100% of their outstanding debts, an increase in your income should lead to a modification of your Plan. You must initiate the modification, by drafting modified schedules I (income) and J (expenditures), and an amended or modified Plan. Since you are obliged to send your prior year's income tax returns to the trustee, he or she will discover the increase, and probably will come back to you with a demand that you file these papers. An increase in earnings does not necessarily mean that all the net raise goes to the trustee. Your other income, or your expenditures may have changed. Retaining a skilled bankruptcy lawyer is almost always worth the investment.

If you have had an increase in income during your plan, I recommend you stay quiet about it unless you feel you have a morale obligation to your creditors.or you are in a 5 year plan because initially you couldn't afford a 3 year plan in which case you may want to amend your plan to a 3 year plan if you are eligible means test wise.

You can modify the plan to increase the payments.