Do i need a new Lawyer?

[tucson]

Hi all,

I have researched this to death and I believe I am right. First we have one c child and we live in AZ so the median income for the means test is 5167 per month. My wife and I fall WELL BELOW this for the past 6 months but last month our side business did well and we made just over 10K which our lawyer says disqualifies us from Chapter 7. I explained that our combined income over the past 6 months is a mere 15K (my wife works for the school district and has summers off without pay) but he insists we no longer qualify and has suggested forming a corporation in Nevada to shelter our business income for six months and then file.

Is he even remotely on the right track? Do we need to wait and make no money for 6 months now? As if this isnt stressful enough I don't like second guessing my current lawyer. I have called a few other lawyers from the Yellow Pages and none seem to want to discuss this issue alone. Anyone have a good guess at least??

Thanks!!!

[DebtEnder]

While yes the income lookback is 6 months and if your income for that 6 months is half or less then the median income you by default are chap 7 eligible. IE you don't fall under the presumption of abuse clause.

HOWEVER the trustee WILL ask if you are expecting more money or income at your 341. If you business is REALLY picking up then the UST could argue for dismissal or conversion based on TOTALITY of the circumstances.

So the question is this was that 9k+ for last month a one time fluke or something you think could occur again on a regular basis. Think about the fact when you are asked this by the trustee you are under OATH.

That is probably what has your attorney worried.

[tucson]

Thanks for the response. I really don't know if it could continue. I have been working my butt off for a long time for zero pay (what got us into this mess) and it finally payed off a little. It is not a regular thing. They could use me again next year or next month I do not know. Was his "idea" of forming a Corp and paying myself a salary to just under the median a good idea? That in itself seems wrong especially since this will most likely not happen again. Thanks again for your response.

On Edit: I have a regular job (for good fingers crossed) the business is/was a side venture. When I finally got the call that they accepted my price I got the job done in a few days and was sooooo excited not even thinking about the consequences. I have not cashed the check yet.

[DebtEnder]

Well to start I would cash the check and spend it down so you don't have to exempt the cash asset.

It sound like you could truthfully say you do not EXPECT a larger source of cash coming in. You hope too but that does not matter. I would get another attorney consult and not mention you had any dealing with the prior one in case they get a biased opinion of the issue.

I would just say as it was, a one time job and there is no promise of more work down the road at this time.

[whipster1]

Are you saying you CLEARED 10K or that was the gross and you still have expenses to subtract from that amount?

[tucson]

Whipster. Last month we cleared 10K with my job, wifes job, and the side job. Hope that clears it up.