Getting a Job after 341 and before discharge

[BKDefender]

Chapter 7 is a snapshot of your financial life at the time you file. If the trustee has already marked your case as a 'no asset' then he/she feels that, AT THE TIME YOU FILED, you did not have any estate assets to administer.

I don't see any problems - work your a$$ off, and enjoy the money.

This is why you file bankruptcy - so you have the chance for a fresh start.
It looks like you've already begun the journey. Congratulations. $7k-$9k in a two week period - you'd be crazy not to take it. Hell, if you don't do the work, tell me whatever it is you do and where to show up and I'll take the overtime :-)

--William

[thoover34]

did you have a lawyer? surely our court system can get you a straight forward answer and explanation---I would GUESS that you have already satisfied the trustee that you were in a bankrupt state when you filed--I would hope that you don't have to stay in that state until you are discharged--let us know how you end up please

[DeadManCrawling]

Potsie,

I would work the hours. The money now is more important than the remote chance the trustee might be interested. You are post-341, were honest in every way I assume, and have nothing to hide or worry about. This is a rare chance to get ahead, and does not materially change your long-term financial picture. I don't think this could cause any problem.

As far as tax refund, the trustee would have asked if it was pertinent. Now is the time to start moving forward, and working these hours can help you do that.

[Fallonedward]

Sorry - that was supposed to be 'become employed after filing BK'.

I've had potential clients (which I declined to represent) who said they just quit their job working for their dad so they could file bankruptcy in a few months, then after filing they would go back to work. If I saw that someone lost their job a month or two before filing BK and started work after filing BK but before the 341 meeting, I would be suspicious. After the 341 meeting - not so much because it's not generally reviewed after that.

--William

William: that is great info, thanks so much...

Both the hubby and I got downsized from our jobs with in weeks of each other and we are both actively looking for work, what if we find a job right before our 341 meeting, will that put us in jeopardy of anything?

thanks

[BKDefender]

If you were downsized from a job and your dad/mom/cousin/relative doesn't own the company, then after the 341 you get a job with another company it would still look suspicious. If the trustee challenges you about it claiming that you did it intentionally, you can point to your papers showing why you were laid off to rebut it.
It would take a lot of evidence on the trustee's side to actually put your bankruptcy in jeopardy - he would have to prove that you intentionally quit your job so you could file bankruptcy. If you were downsized then he won't be able to do it and you'll be fine.

I know it's a stressful life event but the horror stories of 341's and bankruptcy dismissal are from people who did things such as hiding money, transferring houses to brothers, giving assets to relatives, etc - not from people who have actual problems and legitimately needed the assistance that bankruptcy provides.

--William

[Fallonedward]

If you were downsized from a job and your dad/mom/cousin/relative doesn't own the company, then after the 341 you get a job with another company it would still look suspicious. If the trustee challenges you about it claiming that you did it intentionally, you can point to your papers showing why you were laid off to rebut it.
It would take a lot of evidence on the trustee's side to actually put your bankruptcy in jeopardy - he would have to prove that you intentionally quit your job so you could file bankruptcy. If you were downsized then he won't be able to do it and you'll be fine.

I know it's a stressful life event but the horror stories of 341's and bankruptcy dismissal are from people who did things such as hiding money, transferring houses to brothers, giving assets to relatives, etc - not from people who have actual problems and legitimately needed the assistance that bankruptcy provides.

--William

William, thank you so much, we both worked in the automotive industry and our companies each have shed more then 40% of their workforce in the last 5 years... I guess we were both lucky to have lasted thru so many previous cuts before it was our turn.... and no none of our relatives own the automotive companies we worked for


We both also got severance packages, so that should prove that we were downsized

[helpme2010]

These posts relate to my problem of hopefully getting a job that my just break the 6 digit mark, maybe. I am curious what happens if I get a job in the middle of the BK or toward the end of the BK, again if I am lucky. So it appears that after the 341 the odds are better that the job will not cause a problem, but still can. So when is the job safe that it won't cause a problem, after the entire BK proceedings are completed and dismissed?

From what I am reading, it looks like an entire BK process is about 4 months total from the start of the filing to the dismissal?

[filed]

The Chapter 7 trustees normally don't monitor what happens after they issue a notice of no-asset case, and especially after they issue the discharge. If you have an asset case he/she will monitor your case for proofs of claim that need to be paid.
Other than what is filed in the docket, the trustee knows what you and/or your attorney tell the trustee... but if your case is chosen for one of the random U.S. Trustee audits and they find that you had a larger tax return, they'll reopen the case and request the discharge be revoked and the case dismissed.

bkdefender, I thought if you were selected for one of the random audits, you would know about that within 10 days of filing...Are you saying that sometimes the OUST selects cases for random audit even after the discharge has been granted?

[justbroke]

bkdefender, I thought if you were selected for one of the random audits, you would know about that within 10 days of filing...Are you saying that sometimes the OUST selects cases for random audit even after the discharge has been granted?

There are two type of audits. The first is the "random audit" that is required under the bankruptcy code. The random audit is done up-front and the debtor knows rather quickly (a week or two of filing). This random audit is conducted by a "third party" company which gathers the documents and matches them with the petition. That defines the "random audit".

Then, there is the Office of the United States Trustee. They can conduct an audit of any case at any time for any reason. According to the United States Trustee Program's website, a random audit can be initiated by the UST which "a case may be selected for an exception audit (audit of a case with income or expenditures above a statistical norm)." (U.S Trustee Program Information on Debtor Audits (8/2011)).

The OUST can audit a case even after discharge and seek to revoke the discharge should there be an issue. I don't think these are as likely unless there is new information provided to the OUST. It is anecdotal, but I see that the OUST usually is "tipped off" by jealous or feuding family members or friends of a debtor seeking to upset the debtor's discharge. This may just be pure hogwash or actually have some factual basis.

Generally speaking, the further you get away from the filing date, 341 Meeting, discharge and close... the less likely your case would be audited, re-opened or have the discharge revoked.

[filed]

Thanks, Justbroke. My case is filed as a no asset 7 but high amount of unsecured debt and slightly over the median income. Prior to the 341, the UST requested additional documents including tax returns, bank statements and Financials from any businesses I was involved in during the year. The UST came to the 341 and asked several questions after the Panel Trustee finished questioning me, and then both trustees agreed to allow the 341 to be concluded.

I suppose this is not a formal "audit" by the OUST, but rather just them taking some interest in my case, given the large amount of unsecured debt, over median income, and involvement in small businesses.

FWIW, the initial 10 days has passed without the UST filing a notice of POA, so, that (ever so small) victory is in my back pocket. Still have to wait out the full 60 days for them to object on the totality of the circumstances I guess.

I have been concerned that the panel trustee has not yet filed a determination of no asset/no distribution, but, soon the 30 days for them to object to my exemptions will pass. I hope if this 30 day limit passes with no objection to my exemptions that will mean I am closer to the Panel Trustee declaring no asset/no distribution. Does that seem logical to conclude?