Does Cash Exemption apply months before filing (CA)?

[Moneypenny]

Hi,

In CA we are allowed to keep a bit of property which I understand includes cash when we file. Does that exemption apply during all the months prior to filing?

If I am allowed to keep the 5k cash i have (not in a bank i owe money to) when i file, is it okay to have that cash in the bank six months before when I stopped paying cc bills, even though I had the money in the bank?

I am supposed to submit a year of bank and cc statements and I am sure this will be clearly apparent: that I could afford to pay my bills six months before filing, but did not.

At this point I not concerned about means test or schedule I + J: good on that.

I get a lot of answers to this question that dont address the main point, which is about trustees looking over my bank and cc statements in the months prior to filing. Am I doing something wrong, and, legally, what is it if so? Or does the exemption apply long before filing?

thanks,

Moneypenny

[tdawg]

I believe you're fine.

[bkmaggster]

Hi,

In CA we are allowed to keep a bit of property which I understand includes cash when we file. Does that exemption apply during all the months prior to filing?

If I am allowed to keep the 5k cash i have (not in a bank i owe money to) when i file, is it okay to have that cash in the bank six months before when I stopped paying cc bills, even though I had the money in the bank?

I am supposed to submit a year of bank and cc statements and I am sure this will be clearly apparent: that I could afford to pay my bills six months before filing, but did not.

At this point I not concerned about means test or schedule I + J: good on that.

I get a lot of answers to this question that dont address the main point, which is about trustees looking over my bank and cc statements in the months prior to filing. Am I doing something wrong, and, legally, what is it if so? Or does the exemption apply long before filing?

thanks,

Moneypenny

The trustee is looking for transfers of cash, for preferential payments, and for unreported income. They are not looking to see if you could pay your bills - the means test and the schedules determine that.

Hope that helps!

[backtoschool]

If you have the exemptions to cover the cash then you are fine.

The trustee might ask you about any large deposits, but that would just be to determine if there is extra cash besides what you exempted or if there is income that you didn't report.

[Moneypenny]

Thanks thats very helpful if its the case. i imagine this is a pretty straightforward question that you folks would know the answer to.

This is from income that is outside the six month lookback, and will not be repeated in the future, so I believe that it is not income that I have to report, although obviously there it will be in the bank statements.

If it is only the means tests and schedules that determine things then I gather I am under no obligation to pay may credit card bills now even though I can afford to at the moment.

I can therefore use the money for whatever I want, or save it. My six months of income starts next month.

Please correct me if I am wrong and apologies for going over this to death! I am sure you understand these kinds of anxieties....

Moneypenny

[backtoschool]

Thanks thats very helpful if its the case. i imagine this is a pretty straightforward question that you folks would know the answer to.

This is from income that is outside the six month lookback, and will not be repeated in the future, so I believe that it is not income that I have to report, although obviously there it will be in the bank statements.

If it is only the means tests and schedules that determine things then I gather I am under no obligation to pay may credit card bills now even though I can afford to at the moment.

I can therefore use the money for whatever I want, or save it. My six months of income starts next month.

Please correct me if I am wrong and apologies for going over this to death! I am sure you understand these kinds of anxieties....

Moneypenny

Here is an example from my own situation that is somewhat similar to yours:

1. I was laid off in January and got a severance in a lump sum.
2. I filed for unemployment in January and moved to Michigan.
3. I filed for bankruptcy in August.
4. My severance was not considered part of my income, since it was past the six month look back period.

5. The only income I had was my unemployment insurance.
6. My severance was sitting in my bank account. I spent what I couldn't exempt and exempted the rest.

The trustee didn't even ask me about the severance at my 341. My lawyer had listed it in some other section of the petition, but it was not counted as income.