$0 Income, Is Schedule J Still Required?

[phoenyx]

If I've had $0 income for a number of years, so clearly qualify for a chapter 7, is Schedule J (Current Expenditures of Individual Debtors) still required? Just wondering if there's any filings that are exempted from it so I don't have to gather all this information.

Edit: Well, actually, my father gives me $1,100 a month so I'm not homeless and unable to eat. I'm not actually sure whether this is classified as income under a bankruptcy...

[oldbaddebts]

yes, it is a required schedule, I might suggest listing the $1,100 and specifically mention it as a gift.

[Joe Farmer]

Are you SURE that $1100 is not income?

Are you also sure you are not required to file a tax return on that amount? I can assure you that if you file a BK and list no income, then that 'gift' comes to light...well, you'll be in a position you won't want to be in...with the BK system AND the IRS. I'd think the trustee would like to know how you ARE eating with no 'income'. Anyway, why do you want to file BK if you have no 'income'- do you have assets to protect from creditors?

[magyar123]

Income - your dad giving you $1,100 a month - as oldbaddebts mentioned - is a gift type of income for bankruptcy filing purposes.
Unless your dad sends you and the IRS a 1099 - don't worry about it as far as income tax filing purposes is concerned.

[phoenyx]

Are you also sure you are not required to file a tax return on that amount? I can assure you that if you file a BK and list no income, then that 'gift' comes to light...well, you'll be in a position you won't want to be in...with the BK system AND the IRS. I'd think the trustee would like to know how you ARE eating with no 'income'. Anyway, why do you want to file BK if you have no 'income'- do you have assets to protect from creditors?

OK, sounds good, it'll probably be listed on Schedule I Line 13, unless my attorney convinces me otherwise.

As for filing bankruptcy, I don't have any non-exempt assets, but want to start a new business and leave behind all of my old business debt. I don't want no income forever, and want to get on with life.

Gifts are not treated as income by the IRS, per IRS Publication 950. Gifts can cause a tax liability for the person giving the gift, but only in extreme situations. For 2007, you can give away $12,000 (each) to any number of people. This number adjusts for cost-of-living increases. If you go above that $12,000 in a year, you are supposed to file IRS Form 709, but even then, it only creates a tax liability if you give an excess amount over your entire lifetime that goes over $1 million while you are alive, and an even larger amount for estate purposes.

[Joe Farmer]

It sure sounds like you can fend for yourself

and file without a lawyer, or the 1-2 thousand that goes along with it? If you can figure out tax law, you can file a simple CH7 alone, eh?

[phoenyx]

It sure sounds like you can fend for yourself . . . and file without a lawyer, or the 1-2 thousand that goes along with it? If you can figure out tax law, you can file a simple CH7 alone, eh?

I definately thought about it, the documentation I'm giving my attorney is actually in the form of all the filled out petitions exhibits and schedules, LOL. However, I decided that I'd rather spend the attorney fees for the additional "insurance" that it all gets done right, since there could be a few complications along the way.