Starting Business while in 13

[spearmint]

In my research about a 13, it appears that the trustee takes all additional income. I am in the process of starting a small business but I am wondering if it makes sense just to stop the plans and forget it since any income from it (or a good portion of it) is likely to be taken by the trustee. Any comments on this one?

[Flamingo]

My thoughts - If you have not filed and start the business before filing and it generates income, that income will be considered in your Chapter 13. If you wait until after you file, you will need to consult first with your attorney if that would be a wise move since any income you generate will more than likely need to be reported and those extra funds would get distributed to your creditors over and above your Chapter 13 plan payment.

[busby]

If you're starting a new business - it's not likely that you'll make enough profit to raise the question with your repayment amount.

Any money the business does make would need to be put back into the business - especially for the first several years and are therefore legitimate business expenses.

Of course, you should consult your attorney to be sure.

[spearmint]

My thoughts - If you have not filed and start the business before filing and it generates income, that income will be considered in your Chapter 13. If you wait until after you file, you will need to consult first with your attorney if that would be a wise move since any income you generate will more than likely need to be reported and those extra funds would get distributed to your creditors over and above your Chapter 13 plan payment.

So either way the creditors get it. Bummer!

BK13 is going to be a real financial hardship for me but I have no choice as I need to pay back unemp comp. I wanted to start the business to try to make some extra money to survive it!

[Flamingo]

So either way the creditors get it. Bummer!

BK13 is going to be a real financial hardship for me but I have no choice as I need to pay back unemp comp. I wanted to start the business to try to make some extra money to survive it!

Chapter 13 is not easy. As to your business venture, just check with the attorney you retain when you do file as you don't want to mess up your Plan if you do file a Chapter 13. You might just have to wait a while and open your business a bit later. What matters the most is right now to resolve your current situation.

[spearmint]

Chapter 13 is not easy. As to your business venture, just check with the attorney you retain when you do file as you don't want to mess up your Plan if you do file a Chapter 13. You might just have to wait a while and open your business a bit later. What matters the most is right now to resolve your current situation.

"Not easy" is going to be an understatement. I have a cancer patient in my home who does not work or contribute. I need to buy a bed! (Don't ask!)

I have struggled through the last 10 years of this economy and made it through but everything now needs to be replaced. I have few clothes, no luxuries, etc. - and now Ch13!!!!!

I only claimed the unemp comp because I had been unemployed for a YEAR and was very, very sick (no health insurance). When I finally got a job I only managed to keep it for about six months (couldn't walk further than one block - and no stairs!). I shouldn't have done it but did. I had no one to turn to to try to survive. I was very sick for over five years. I had surgery in 2005 and got a job in 2006 which I still have and I feel fine but now I have to pay the price for being sick!

I feel like jumping over a bridge.

[Flamingo]

"Not easy" is going to be an understatement. I have a cancer patient in my home who does not work or contribute. I need to buy a bed! (Don't ask!)

I have struggled through the last 10 years of this economy and made it through but everything now needs to be replaced. I have few clothes, no luxuries, etc. - and now Ch13!!!!!

I only claimed the unemp comp because I had been unemployed for a YEAR and was very, very sick (no health insurance). When I finally got a job I only managed to keep it for about six months (couldn't walk further than one block - and no stairs!). I shouldn't have done it but did. I had no one to turn to to try to survive. I was very sick for over five years. I had surgery in 2005 and got a job in 2006 which I still have and I feel fine but now I have to pay the price for being sick!

I feel like jumping over a bridge.

Bankruptcy is a life event and causes all sorts of emotional issues; and the period prior to filing can be a nightmare. We've all been there. A Chapter 13 Plan runs from 3 to 5 years. Your overpaid unemployment that you owe can be spread out during that time if you are able to file a Chapter 13. It cannot, however, be discharged. It would help you greatly to go see an attorney as to your situation so you do not worry yourself sick over what can and cannot be done. Consultations are free with most BK attorneys. Believe it or not, as bleak as it seems now, you will get through this.

[spearmint]

I do have an attorney and have asked many questions but I find he hasn't told me everything - as you can see.

[HHM]

Trying to start a business in a chapter 13 is unrealistic (unless your business is going to be selling your old crap on craigslist).

Any "real" business venture requires money (and credit) and while in a chapter 13, you will have neither.

Get out of debt, complete your chapter 13, etc, then you will be in a much better position to pursue a business.

[spearmint]

Small web design business

[HHM]

Small web design business

Great, just what we need, another web designer...really, that business niche is so crowded, how are you really going to set yourself apart. I don't want to burst your bubble. You will still need money to market, (I will assume you already have the appropriate software, but if not, your talking some investment into software and hardware).

I hope you can offer something different, but if your just gonna be the run of the mill web designer that takes off the shelf templates and merely recolors them, and inserts a custom logo, go do something else.

[spearmint]

I think your comment was very rude. I do not have to explain my skills or credentials to anyone.

[sassiebaz]

Great, just what we need, another web designer...really, that business niche is so crowded, how are you really going to set yourself apart. I don't want to burst your bubble. You will still need money to market, (I will assume you already have the appropriate software, but if not, your talking some investment into software and hardware).

I hope you can offer something different, but if your just gonna be the run of the mill, loser, web designer that takes off the shelf templates and merely recolors them, and inserts a custom logo, go do something else.

HHM seriously, you are extremely knowledgeable on BK and whatnot. But, that was NOT very nice what you stated in this last post. The OP is obviously trying to make something right in a not-so-right world. Cut the OP some slack....please! Everyone has to take some risks sometimes. Spearmint.....Good luck, I hope it all works out!

[HHM]

Ok, perhaps I was a little harsh, but these are fair questions.

Web designers are a dime a dozen. Thus, it is a fully mature industry with small barriars to entry. Anyone with a computer, some software, can market themselves as a web designer. You either need to find some niche within the industry to exploit, or economically, you are better off doing something else.

Every business owner needs to ask them self how they are going to set themself apart from the competition, what customers are they going to target, and how are they going to get in front of those customers. Getting in front of customers usually requires some spending.

[sassiebaz]

Ok, perhaps I was a little harsh, but these are fair questions.

Web designers are a dime a dozen. Thus, it is a fully mature industry with small barriars to entry. Anyone with a computer, some software, can market themselves as a web designer. You either need to find some niche within the industry to exploit, or economically, you are better off doing something else.

Every business owner needs to aks them self how they are going to set themself apart from the competition, what customers are they going to target, and how are they going to get in front of those customers. Getting in front of customers usually requires some spending.

I DO agree......you need to start somewhere though. I have considered a consultant/product sales based business myself. It's one of those things that stay at home moms do or even working Moms for that sake. I have been back and forth due to the economy. I really like the products and so do many of my friends and aquaintances. I still may go for it when summer nears. Based on what the attorney told me, after we file our trustee should not care what happens to our income. If I start this business I may generate a couple hundred a month to start. It's something but not significant enough to warrant the trustee raisning an eyebrow.....