How is overtime pay figured into income?

[tryn2bfree]

right now i'm making about $1000 per month in overtime pay but this is NOT guaranteed! does anyone know how this will be figured into my income? if they determine my ch. 13 trustee payment based on my OT pay and then that goes away, i'm afraid i won't be able to afford my trustee payment!

anyone have experience with this???

[Flamingo]

Well if you continue to receive that money that is approximately $12,000 more per year than what you listed when you filed. You need to contact your attorney about this because it is not a small sum and playing games with finances is not something you want to do during a Chapter 13. Always ask your attorney when it comes to finances as to your own particular plan. The trustee percentage is based on the amount of debt in your plan.

[Flamingo]

I reread your posting and see you are worried about your Plan payment to the trustee and not the trustee payment which I assumed was the percentage of your plan paid to the trustee. With this increase, your plan could be modified wherein there is more disposable income to be given to the creditors and it would be disbursed among them and increase the percentage paid to them in your plan. Since your increased income is not a minor sum, contact your attorney so you comply with what is necessary for your plan.

[lockedout]

right now i'm making about $1000 per month in overtime pay but this is NOT guaranteed! does anyone know how this will be figured into my income? if they determine my ch. 13 trustee payment based on my OT pay and then that goes away, i'm afraid i won't be able to afford my trustee payment!

anyone have experience with this???

The attorney can use a attachment to your case stating that your overtime is not a garantee. Mine filed a attachment, trustee didn't object, we were still on a 100% plan without overtime though. When are overtime went away and production slowed are income was well below what are attorney said was are base income, due to the incentive pay loss we had on our checks.

[rjl0206]

I was pretty much told that unless I wanted my overtime to be counted as regular income I would have to avoid any significant amount of overtime or ANY if I can avoid it for the next six months so when they do the 6 month look back it should be based on my regular work income. This is because as you stated overtime sis not guaranteed, and anything can happen in 5 years. I was also making ends meet with all my bills and such because of the overtime for the past 3 years, I mean, screw it, if im going into bk why should I still kill myself working 90-100hr work weeks in the hospital barely seeing my family just to pay back a greater creditor percentage!!. During BK my family and I can learn to live within our means without credit, I can work my regular 72-80 hours/week and slip in an overtime here and there for the holidays and special occasions. I dunno if anyone else on this forum can say this but im kinda actually looking forward to bk in a wierd way because at least (hopefully) my payment plan wont be so high that it would require me to look for overtime and work anymore extra jobs just to make ends meet. (THANK YO MEANS TEST!!) Anywho, just my 2 cents.

Ray

[kornellred]

The way I read your post is - you have not filed yet. Whatever you earned in the past 6 months is what your plan will be based on. It's just the "luck of the draw" when it comes to Chapter 13. It would be best to wait until the overtime dries up for several months before you file.

[cityish]

This is exactly why I'm turning down a chance to teach summer school this year. It's easy money and god knows I need it right now, but there's a chance I may be sued and forced to file Chapter 13 sometime this year what with all my defaults. So I need to keep my income down in the meantime. It sucks!

[inneedofhelp]

same situtaion....my OT is being used for DMI and it will not alwys be there, if I have to make 6 months of the trustee payments and not take OT to bring down the payments then i think we will go under, it's that bad... but the trustee will not listen to my plea that the OT will not be there...we have not yet been confirmed because we've had to refile twice since the initial filing and the payments have swung between 1100 and 500 and now they come up with 745 but the trustee wants to go back to the 1100 which we will not be able to make and survive...any help would be appreciated.

mike

[sealpup]

I agree- why kill yourself and neglect your family to have it go into trustee payments? We are getting ready to file and hoping for a Ch. 7, but if we end up in a 13 I will either quit my job or significantly cut back my hours as most of my pay would be going to the plan. I'd rather be spending the time at home w/my kids while they are little than working to pay creditors back who never cared about me to begin with and refused to work with us.

[BKParalegal]

If you have a long pattern of receivng overtime and didn't reduce the hours worked months before you filed then it will be counted end of story, unless you can show by providing documentation that overtime was or is being cancelled and will not resume in the near future.

By arbitrarily stopping overtime at the time of filing without showing any history without the extra income is filing in bad faith, unless you can prove that medically you need to stop.

Good luck

[kornellred]

This is an extremely common dilemma among Chapter 13 filers. Annual incentive/bonus payments are also a thorn in the side of filers as they plan for bankruptcy. It would seem that the 6 month look back in determining annual gross earnings was the best possible compromise in order to keep the bk system from becoming too complicated. There is likely no way to convince a trustee that the overtime you worked during the 6 months prior to filing would not occur again - overtime only occurs when your employer finds it necessary, and it is random in nature.

[MSbklawyer]

Generally speaking, they will look back 6 months to see what your average overtime earnings has been per month. Unless you know or are virtually certain that you will no longer receive over time, it will be assumed that you'll have the same amount going forward. That's the S.Ct. Lanning decision.

After you have filed and have begun plan payments, if your overtime should dry up substantially, you can always amend your plan.

[Billssuck]

Yes, I agree that there is a six month look back period for income when you file. That's straight up and you will need to plan accordingly for that when you file. For us, our income (both me and my husband) varies every month and I have asked my attorney several times how I calculate it to make sure that I don't go over the 10 percent increase in income that I am required to tell my trustee about. He just repeats, "If you go over 10 percent, let me know." Period, that is all he says to me. So...I keep track month-to-month of what is coming in and sometimes I turn down work to make sure that we don't hit the 10 percent by the end of the year. Last year (I'm an on-call worker), a person at work had to have a replacement for 3 months straight and I was called to work the entire period. You can bet that bothered me with my ch13 plus like others said, it took time away from my young son at home. I don't want to work harder to pay creditors (who have now written me off as bad debt and sold my account to 3rd parties in chance my ch13 fails) and miss time with my family. But I will have to say that when we filed, we just looked back six months and realistically it has been a pretty accurate amount (+/- 10percent). Before our ch13, I would have given anything to work more and harder to support our family, now I'm limited and actually liking it. Life isn't all work!