Starting a business before declaring BK

[1967]

Hello everyone

My wife and I have just payed a retainer to secure an attorney and in a couple weeks he is going to file for chapter 7 for us. He is on a 1 month vacation right now and I have a question I was hoping to find an answer for.

I have been unable to find work (construction) for two years and it has really buried my family. I have no choice but to start my own business and try and make some money to keep afloat. Is this a good idea considering we have not officially filed yet?

Anybody see any issues with this? My wife is employeed by a business and her wages are garneshed so I need to do something. I am a little concerned about being asked about income for my new business at a later date in the process. Anybody ever heard about someone starting a business during the process or even before it's officially filed.

Mike

[1967]

After doing some reading hear on the forum I'm under the impression I have every right to start a business and the only real problems I could encounter are 1.) Qualifying for the means test. and 2.) Money left over after expenses.

Am I reading this right???

Mike

[mtbc]

I don't know, but I'd expect an extra issue is that they may want to look hard at your business-related income and expenses, which might be extra time and hassle for you.

[JRScott]

What you could run afoul of is the totality of circumstance clause.

At the 341 the Trustee will ask you if anything has changed. You having a job and having income would be a change, depending on how much you made it might or might not affect the outcome. Thus it might be better to wait til after the 341 meeting to try to start a new business.

[nerves]

Another thing to keep in mind is any assets from the business may not be exempt. I think the exception would be if you are a Corp. You could lose the assets that make a living for you. Good luck to you and your business.

[1967]

Thanks for the thoughts

I'll have to run that past my attorney when he gets back from vacation.

Mike

[frogger]

I would wait until after filing and the 341 before starting a new business.

[1967]

Thanks Frogger!

This is so messed up because the bk process is preventing me from making any money at all. God, I can't wait till this is all over.

Mike