How to report uncollectible Accounts Receivable?

[sadhobbit]

I have a substantial Accounts Receivable amount from a client due to me for past consulting services. The company is still legally in business, but their funding has totally dried up. They are not paying any of their employees or contractors at this time or in the foreseeable future. This cashflow shortfall is what is forcing me into Chap 7. I know that I must list the Receivable, but should I also somewhere note that I have been unsuccessful in collecting upon it? I am more than happy for the Trustee to put the screws to them to collect upon the dept since I did not have the leverage (or the ability to pay a lawyer) to force their hands.

[StartingOver08]

Yes, because the Trustee will go after the asset/receivable and keep your case open until either the recievable is collected or terminated (if your client files). This way the Trustee has the full scope of your 'asset/receiveable'.

My attorney put the status right in the petition - when a couple of the contracts fell through, I submited the cancelations and we proceeded timely with my discharge and closing.

[OhioFiler]

I have a substantial Accounts Receivable amount from a client due to me for past consulting services. The company is still legally in business, but their funding has totally dried up. They are not paying any of their employees or contractors at this time or in the foreseeable future. This cashflow shortfall is what is forcing me into Chap 7. I know that I must list the Receivable, but should I also somewhere note that I have been unsuccessful in collecting upon it? I am more than happy for the Trustee to put the screws to them to collect upon the dept since I did not have the leverage (or the ability to pay a lawyer) to force their hands.

There is no place to list the status of the receivable. It's an asset and it's up to the Trustee to deal with until your case is closed. If it hasn't been collected by the time your case is closed you can continue to try to collect yourself.

You might have favorable tax treatment for this write-off.

[StartingOver08]

Actually, once you file, the receivable becomes an asset of the BK estate - you do list the status - you just need a good attorney that knows what they are doing. The Trustee will go after the receiveable. Typically you get discharged, but not closed, if there are still assets to be 'collected'.

[sadhobbit]

Discharge versus open casefile

Thank you for your prompt replies. Please note that I am filing pro se as I cannot even afford an attorney. I'm confused regarding discharge. I wish to wash my hands of this mess, obtain my discharge and move on with rebuilding my financial life. I currently believe that the AR is not collectible due to the current status of the company's funding (there isn't any). I've tried for months, short of a lawsuit, to collect upon it. I am quite happy for the Trustee to go after them and make their lives miserable. However, this can take quite some amount of time. Will my discharge be held in suspense while the Trustee pursues collection?