Gifts from family during Chapter 13?

[2ndChanceTx]

Does anyone know if a gift (say $10,000) from a parent during a chapter 13 has to be given to the trustee? Its not earned income, not inheritance, but a gift....

Thanks,
2ndChanceTx

[Flamingo]

Does anyone know if a gift (say $10,000) from a parent during a chapter 13 has to be given to the trustee? Its not earned income, not inheritance, but a gift....

Thanks,
2ndChanceTx

An inheritance is also a gift that is nontaxable to the receiver in most instances. As are awards given in insurance claims (i.e. personal injury lawsuits. If the amount is additional to your finances during the course of a Chapter 13, it is required to be reported as it is money that you did not have when you filed. Your entire financial house is under the control of the Trustee from the day you file to the day you are discharged no matter how you try to get around it.

[imbroke2]

I keep seeing questions like these. If you have an attorney, I would contact him/her first regarding any extra money. I asked specifically about our taxes and our attorney said that that money is ours, we don't have to worry about giving it to the trustee. I have a feeling he would say the same about any "gifts" we might receive during our time in the 13, although $10K is a little more. So, like I said contact your attorney. I think every district and every trustee is different. Some want every penny, others don't.

[AboutToBK13]

I commend your honesty for even raising the question on the forum.

If it were me, I would ask for the money in cash, stuff into my MATTRESS SAVINGS and LOAN account, and keep my mouth shut. But that is just me.

Again, kudos to your honesty.

[$$only4ever]

Does anyone know if a gift (say $10,000) from a parent during a chapter 13 has to be given to the trustee? Its not earned income, not inheritance, but a gift....

Thanks,
2ndChanceTx

I would not accept the gift until after you were discharged. Better to be safe than sorry.

[JollyGG]

Is the gift to pay something specific. You may be better of asking the gift giver to just pay whatever it is for instead.

The answer probably depends on your trustee and your districts practices.

Do you intend to claim this gift on your taxes?

[MOMof3]

My first question would be what the money is for? If they can just buy you what you need, or pay what you need them to, I would have them do it directly like a previous poster suggested. My parents frequently purchase store gift cards for me--well, let's say it is for their grandkids--I imagine over the course of my 13 this total would be significant. They also buy groceries, gas, etc.. when they are here visiting. It is their way of helping me out & I don't ever plan to inform the trustee of these "gifts".

[wooisme]

anything that leads a paper trail is what you need to really be concerned about. interesting enough though you could play dumb especially if there are no instructions that were given to you about such matters. Like if it's not on your confirmed plan stating that all monies are to be turned in or must be addressed. Mine says NOTHING at all on my plan about money increases at all............my handbook that i received in the creditors meeting says nothing whatsoever about reporting money coming in or how to handle that.

so my question is, if it's such a big deal to them about money, then why don't they put it in black and white that any money you receive whether it be by gift, earnings, etc MUST be addressed with the trustee. it seems awfully flimsy that if you get caught with more money than your suppose to have etc. how are you suppose to KNOW this stuff if it's never been addressed, it's not in writing explaining this. one could really argue the point...........well if this is true, where is it in writing that says i have to turn over money, etc...if it's so important why isn't it in writing.

[2ndChanceTx]

No cash has passed, I am just asking... wasn't sure if someone had already been in this situation...

[Flamingo]

No cash has passed, I am just asking... wasn't sure if someone had already been in this situation...

Many parents "gift" to their children each year as allowed by the IRS. If this is your case or what you are referring to, I would certainly have the involved parents question their attorney inquire about this being done during the course of any bankruptcy regarding their children and what can be done to avoid having to worry about those funds.

[nervousnellie]

Is the gift to pay something specific. You may be better of asking the gift giver to just pay whatever it is for instead.

The answer probably depends on your trustee and your districts practices.

Do you intend to claim this gift on your taxes?

Gifts of money are not reported on the tax return by the receiver of the gift. May or may not need to be reported by the donor on a gift tax return.And very rarely is it taxable to the Donor .Depends on the amount given over one's lifetime.

[Flamingo]

so my question is, if it's such a big deal to them about money, then why don't they put it in black and white that any money you receive whether it be by gift, earnings, etc MUST be addressed with the trustee. it seems awfully flimsy that if you get caught with more money than your suppose to have etc. how are you suppose to KNOW this stuff if it's never been addressed, it's not in writing explaining this. one could really argue the point...........well if this is true, where is it in writing that says i have to turn over money, etc...if it's so important why isn't it in writing.

It is - it's in the Code. I find it funny how some people get huge packets of information listing everything and some people get hardly anything. It's best to educate oneself about a Chapter 13 as much as one can while in the Plan. With all the stuff now on the internet (entire code) telling a trustee that one "just did not know about it" probably wouldn't go over very big. Stuff like Christmas and birthday gifts doesn't matter (hoiw would one report that new gift of an expensive winter coat?). The new law goes after fraud and abuse moreso than the old law - i.e., large sums attempted to be hidden away from the Trustee; nonreporting of inheritances and lottery winnings, etc.

[wooisme]

stuff like this doesn't really pertain to me anyway, I'm just sort of aruging the point is all. My mother (with the advice of her lawyer) took my share out of her will entirely and gave it to my brother or putting it in his care with stipulations of I don't receive it until a certain age which is about one year after discharge. However my mother could still be alive after discharge.

it's very interesting to note that on my confirmed plan it's ordered that i can't visit the trustee's office without an attorney (who would want to) and that I can't sell, acuire, purchase, refi, anything over $5k anything under $5k i can do.

in the confirmed plan interesting enough, it says nothing about gifts, receving such, giving such , winnings, and so on. wondering if i win the lottery or get a gift of $4,999 could it be kept! says nothing about income taxes, turning them in or showing proof of them being filed. In the handbook it says just to have them on hand in case he wants them.

What tickles me above all is that we are regular "stupid" people who generally need things spelled out.....listing codes etc to me is more of an entrapment....people don't know what all those codes are or what they mean. most people who are declaring bankruptcy are wrecks! they basically are under so much stress and are not thinking properly...do you really think most people look up all those codes read what it says and understands it????

What i'm saying is that there are a lot of people out there who don't even have the internet...whether it's because they can't afford it (after all bankruptcy means broke) and some don't have computers for the same reason. most people who are in bankruptcy are working day and night to make the payments. they don't have time to run to a library!

If this stuff is so important then they need to include a list in black and white about what you need to do or what you must report and so on and so forth in black and white.

code 23.455.6675 ????? what does that mean

vs.

YOU MUST REPORT ALL LOTTERY WINNINGS, GAMBLING WINNINGS!!

needs to be spelled out!

[NotFun]

my attorney said it is fine to get a "gift" from anyone. He just said its better not to leave it in your account for the world to see, and the reason for that is it raises flags for someone to try and take it.

[Flamingo]

What i'm saying is that there are a lot of people out there who don't even have the internet...whether it's because they can't afford it (after all bankruptcy means broke) and some don't have computers for the same reason. most people who are in bankruptcy are working day and night to make the payments. they don't have time to run to a library!

If this stuff is so important then they need to include a list in black and white about what you need to do or what you must report and so on and so forth in black and white.

code 23.455.6675 ????? what does that mean

vs.

YOU MUST REPORT ALL LOTTERY WINNINGS, GAMBLING WINNINGS!!

needs to be spelled out!

I agree with you but one must realize that one has to cover one's own butt during their Plan. I would not take any advice given off the internet as advice from my own attorney. What happens to one does not happen to the other and everyone's situation can be different in so many respects but similar in so many respects. When anything financial goes on during your Plan that is not part of your Plan and you have no idea what needs to be done with it, if anything, ask your attorney. Best advice anyone can give to protect themselves. You are paying for his/her services during the entire course of your Plan. Ask and get an answer.