Need Help...in Tennessee - Question on Severence Pay

[brokeinTN95]

Hi.... here is my story (short form). My husband and I have filed for Chapter 7. We turned in the paperwork last week and the attorney/paralegal says they will get it filed on Monday or Tueday. My question is this. My husband was terminated from his job recently. the plant has closed and becasue of this -- the terminated employees are getting a "buyout"so to speak. $12400 total. We will not be receiving this money until after the paperwork has been filed. he has not received any wages for the last month other than unemployment. The attorney says we dont have a problem qualifying for chapter 7 - but i'm afraid this money will be taken from us... Can we keep it - do we have to exempt it??? Can we use it to catch up on bills and for upcoming school supplies/clothes for our kids?? the attorney said to spend as much as we can - but give her a list of what we spent it on. Now i know we wont spend all of this - there is no way we can. Unless we went hog wild. but would like to keep some of it in a savings account if we could.... My husband still has not found a job and I'm sure we will need some of it in the next few months.

Help--

[Flamingo]

This buyout or severance (lump sum) will be taxed so the gross amount you are stating will be way less. If your husband was already terminated, this buyout or severance will be will show that date as the starting point for whatever term the severance or buyout covers from his date of termination (i.e., one month pay, six weeks pay, etc.) and also the ending date of any health or other benefit coverage. If you've discussed this thoroughly with your attorney (i.e., exact date of termination, etc.), then follow your attorney's advice and ask her directly about the savings account.