house hold income question

[RAnthony83]

Hello,

I am going to file ch 13, all the debt is mine, but my lawyer said that my wife's income will need to be used as well( she is not filing with me). Which is fine, but she also runs a Etsy business and it was booming due to COVID-19 and mask mandates. the business has recently took a nose dive.

The Etsy deposits into her personal accounts, which to my understanding, they wont need her accounts because shes not filing. The income will show on our taxes in 2021 because we file joint though so the trustee will see it if they review our taxes next year.
Will the trustee want to include her Etsy income?

Shes also currently on STD , but once she returns from maternity leave, she will be salaried. I am mainly concerned with the Etsey income ballooning her income over the past 6 months, when in actuality forward looking this spike in income will most likely be non existent.

Thank you!

[justbroke]

When you file bankruptcy without a spouse, it complicates things. Yes, all spousal income is included in the filing spouses bankruptcy calculations. Having a business where the income is highly irregular, makes formulating a Chapter 13 payment plan that much more difficult.

I do not know how the Chapter 13 Trustee will fashion. your plan. I don't know if they'll use an average, or require tax returns to determine the actual income. The nice -- if that's possible -- thing to say about a Chapter 13 is that it is forward looking. Although the means test may make it look like you make $x, the forward looking nature of Schedule I/J (for Chapter 13s) could prove that the means test is wrong. In most districts, the Chapter 13 trustee first look to the means test as a sort of baseline, but then factor Schedule I/J. If you run into trouble, with Means Test vs. Schedule I/J discrepancies, your attorney should fight for the Schedule I/J findings.