HELP!!! MIL filed pro se in NC, and bk administrator requests addt'l 'clarification'

[mysticspirit25]

Ok, here is the story. My MIL filed pro se in the ED of NC. She had no income, husband has a business that is failing, and never shown a profit. She filed listing her means as "0" because in truth, there was no income for either herself or her husband (she owns nothing of the business), it was her filing only, not her husbands.

In doing the means test, it asked her husbands 'income' from business which is something like 29k a month, but it also asked for reasonable expenses, which was on his taxes as about 34k a month. So she put "0" on the means test.

341 went well, she was the only pro se there, and TT treated her very nice, asked if the business has yet to turn a profit, etc, and she said no, asked her how she has been living, told the TT, friends, family, and of course CC's, TT asked why she filed BK w/o atty, she said she couldnt afford it. He said he deemed no asset and concluded the meeting. He was very nice...her 341 was the quickest out there...

this is what posted on PACER...
Minutes Of 341 Meeting, Debtor Present-, Meeting Held, Report Of No Distribution - The trustee reports that the trustee has neither received any property nor paid any money on account of this estate, that he has made diligent inquiry into the whereabouts of property belonging to the estate, and that there is no property available for distribution from the estate over and above that exempted by the debtor, The trustee certifies that the debtor(s) identity has been verified by appropriate photo identification and the debtor(s) social security number(s) has been verified by appropriate documentation. (TT's name)

Well thats it...no request to be discharged from his duty, etc...

THEN...Friday I get an email (b/c I emailed the BK admin her taxes b/c she has no internet), that says:

Mr. xxxxxxxxxxxx,

I am emailing you regarding the above referenced bankruptcy case. You
emailed Mrs. xxxxxxx' tax return and pay advice information to our office on
2/11/2009. The documents emailed to our office were sufficient. However,
I need to talk to Mrs. xxxxxxx about a few items listed in her bankruptcy.
Specifically, I need to know about her husband's employment (i.e., his
business). Is it still operating? Her Schedules show $0 in income for
both her and her husband. Ultimately, I need clarification on everything.

So, I am emailing you, in hopes, that you will be able to direct my
correspondence to Mrs. xxxxxxx. I will need a response to my email no later
than Monday, March 16.

Thanks in advance,

Rick XXXXXXXXX
Bankruptcy Analyst
Office of the U.S. Bankruptcy Administrator
(999) 999-9999 Ext. 27 (i edited all identifying info)

SO.....

Before I go and scare the hell out of my MIL, What exactly is going on????? I emailed him back and told him I would contact my MIL and have him call her.....I helped her with her BK...but...I don't know what this is....any suggestions???

[lrprn]

Your MIL's trustee's administrator is trying to reconcile that her tax returns show her husband has income but she said on her forms he had zero income.

[mysticspirit25]

I understand what you are saying, but I looked at the tax returns, it shows for 2007 her husbands actual income as 24k, and loss of -107k. So I guess the mistake was her not putting the 24k he drew as salary as income, either way it is below the means.....will he want her to amend? B/c that was for 2007, as for 2008, he did not do his taxes yet, and his salary was not determined.

[lrprn]

So I guess the mistake was her not putting the 24k he drew as salary as income, either way it is below the means.....will he want her to amend?

Yes, her filing forms will have to be amended to show his gross income from all sources that he earned during the six full calendar months before she filed.

B/c that was for 2007, as for 2008, he did not do his taxes yet, and his salary was not determined.

His taxes have nothing to do with his stated income on the Means Test - it's his *gross* income from the prior six full calendar months before filing that's used.

[mysticspirit25]

Does "all sources" include the business income...b/c the means test specifically states "business income" and "business expense" and there is a negative and it says if there is a negative, you put "0". So only personal income will need to be amended????

[lrprn]

Does "all sources" include the business income...b/c the means test specifically states "business income" and "business expense" and there is a negative and it says if there is a negative, you put "0". So only personal income will need to be amended????

Unfortunately now you're getting into more complicated bk territory - frankly this can be a risky place for a pro se filer to be .

The answer to your question likely depends on how the husband's personal business was legally created. Is it an LLC? Is it incorporated? Sole propriatorship? Partnership? Something else?

Hopefully one of our personal business-savvy mods or members can help you sort this out from here.

Ultimately it may well be worth paying for a half hour of an experienced bk lawyer's time to get a solid legal opinion about this since the trustee's office has already indicated they see an income discrepancy in her original filing.

[mysticspirit25]

Her husband is a sole proprietor, he is not incorporated or LLC'd.