If one is self-employed, is 341 meeting complicated?

[pileated]

My husband's 341 meeting is 5/11. He is self-employed and has been for his entire life.

Will the trustee want more information from him because of this?

The lawyer asked for a P & L for the 6 months prior to filing, which I can supply. Other than that, we haven't heard a peep.

Doesn't stop me from worrying, though.

Thanks for the help,
pileated

[StartingOver08]

It is complicated only if you don't have all of your information to the trustee before the meeting.

I am assuming you supplied X yrs of tax returns, plus X yrs of bank statements etc. Usually with a small business or self employed filer the Trustee may want to see more than the 6 mths of data to determine your status. The look back on your income/payments is still six months. But additional documentation can be required by the Trustee. Your attorney will know how the Trustee handles small businesses and self employed filers.

[pileated]

StartingOver08, no one has asked DH to supply anything except a P & L. There are still 2 weeks before the 341 meeting, so there is still time for either the attorney or the trustee to ask for some paperwork.

I guess I'll send my husband to the 341 meeting with bank statements and tax returns for the last couple of years, plus the P & L for the 6 month period before he filed (which the attorney did ask for).

Thank you for helping me.

piliated

[blockhead]

P&L and balance sheet

is what I had to produce. 341 uneventful.

[fireworks]

My attorney asked for 1 year of bank statements and P&L statements (broken down by month). The paralegal told me that 6 months was required, but that the trustee would most likely ask for 1 year, and if they had it all prepared ahead of time it would be easier.

As someone else has said, the best strategy is to have all of your paperwork in order and ready to go. I listened in to several of the cases that went right before us just to get a feel for it. Those who were very well prepared, including one pro se case, were in and out quickly and with minimal hassle. One corporate case took much longer because the individuals could not answer the simple questions that were asked of them and had no documentation with them. I'm amazed that their attorney let them get that far without knowing some basic information about how much their business made every month, what their assets were etc. The trustee wrapped up the 341 by asking them to provide their QuickBooks file on a CD so he could peruse it and find the information himself.

I sat down at the table with my stack of files and a handful of checks from customers that came in between the filing and the 341. The trustee made some comment about my being "loaded for bear," asked me several questions about the business income and assets (very little and none, which is why we filed) and ended up abandoning the checks to me at the end of the meeting. My business had several long-term contracts still active (customers making payments on purchases) and I assumed the trustee would want to take those over, but he wasn't interested.

Get your paperwork in order, act confident and prepared (but not cocky) and you'll probably be fine.

[goingcrzy]

you'll be fine. The trustee just wants to make sure your not hiding assets in you business account and to make sure you haven't overpaid your est taxes (to hide money and get a big refund)

The only issue you could run into is if he has a significant value to his business. Then the trustee may look at the business as an asset he can see to pay back creditors.

[miindebt]

Just out of curiosity, what is your husband's yearly gross in his biz? We have a small biz, too, and gross 180,000 or so a year (but net income for both of us is only in the 20k range) and I'm thinking we're going to get looked at more because of this...We're filing a 7 soon.

[pileated]

Just out of curiosity, what is your husband's yearly gross in his biz? We have a small biz, too, and gross 180,000 or so a year (but net income for both of us is only in the 20k range) and I'm thinking we're going to get looked at more because of this...We're filing a 7 soon.

We have 2 businesses. The combined gross for 2009 was 145,000, and the expenses were 92,000.

Unusual expenses were those associated with moving to another state: 2 trips to that state, 4 moving vans, and 3 weeks spent there getting things set up, lots of workers to unload, problems with first office necessitated moving to another one two weeks later.

We do not have any personal expenses that masquerade as business expenses, so we shouldn't have any problems with the trustee about that sort of thing. It is all straightforward.

In 2007, for comparison, we grossed twice as much, and our expenses were $76,000. The economy has hit our business really hard between rising prices and much lower sales.

[pileated]

I am worried about the inventory for one of our businesses. It's value on the books (and on the IRS schedule C) is $15,000, which is what we paid for it over the years.

The attorney says it can be sold as a bulk lot for $2500 and that is what he valued it for on the bankruptcy papers.

It would cost around $10,000, for the trustee to hire workers, pack it up, move it, unload it, and store it. He would not be able to sell it as a bulk lot for very much money, if he could find a buyer. We tried selling the business already, and there were no takers. The only way the inventory would be valuable to the trustee is if he operated the business as a going concern, and it would take him 6 years to deplete it.

That does not mean the trustee wouldn't grab it anyway. If he does, there goes a huge portion of our meager income. Plus, we would have to somehow get out of our commercial lease, which we reaffirmed.