roommate question

[sidhesadie]

This may be a stupid question, but, I don't have to list my roommate's income anywhere, right? we each pay half of everything, and I pay directly to the landlord and utility companies.
I know if you're married you have to include your spouses income, but you don't have to include a roommate, do you? I realize I can only claim the portion of expenses I actually pay, I just want to make sure her income won't come into it, because she makes good money and doesn't have debt.
TIA
Sadie

[SMinGA]

Confirm with your attorney - but from the sounds of things you're purely roommates and share no household expenses. Of course, you'd only claim your 1/2 of the rent/utilities as well.

Might have to list the roommate as a co-debtor for the apartment lease though.

[Beeheery]

A roommates' income should never have anything to do with someone else's eligibility to file. If it is not their debt, and yours solely, I don't see how legally it could matter if they make 100K or 1 million a year-they are NOT responsible for your debt. I don't know why in the world or how it is legally possible to not allow someone to file Ch. 7 due to someone else's income. I had an attorney a couple weeks ago tell me I am ineligible to file CH. 7 because my roommate makes over 100K a year. It doesn't make any sense at all.

[tcreegan]

logical and legal

Hi all,

Be careful Beeheery, spend some time on the forum and you will see what is logical may not be legal. Legal seems to exist in its own world sometimes.

Sidhesadies, if you split your expenses 50/50 you do not count roommates income. If roommate pay 60% of expenses, the 10% would need to be counted as income to you.

And of course, as SMinGA says, you only get to claim your half of the household expenses.

Good luck to you in your filing,

Tom in Colo

[Beeheery]

The attorney I spoke with recommended I relocate to a homeless shelter or move in with a poorer friend for a minimum of 180 days and then file. SERIOUSLY???? Puhlease.

[sidhesadie]

Yes we do each pay half and I pay the landlord and utilities directly. We each buy our own food, even.
I don't see how a roommate could affect your filing either unless it's unclear if they are paying your expenses or not, but I know that the legal world sometimes isn't the same as the real world, lol. But it seems people who have 3 or 4 roommates would never be able to file BK then, just for renting a room in a house, which seems nonsensical. But my roommate makes well over the median and has no debt, so it would've screwed me up to have to use her stuff. I make well UNDER the median with over 35k in cc debt, plus a second mortgage on a house in another town.

[Beeheery]

Sid-
I spoke with ANOTHER attorney this am (on the phone) and she told me the same thing the other attorney told me. It doesn't matter that roommates are not responsible for the debt-their income still is counted towards means test eligibility. This is seriously the most ridiculous thing I have ever heard of in my whole life. My roommate makes over 100K a year (before taxes), but has a mortgage, car payment, 50K in student loans, his own credit card debt and a ton of other financial obligations. And these people want to tell me that HIS income affects my eligibility to file BK on MY own debt? I just can't believe it. I need a drink...

[sidhesadie]

This may be a district difference, but I spoke to an attorney this a.m who said that people run into trouble with this because they want to use the roommate to indicate household size (ie, make household size 2) but not use roommate's income.

I am a single parent, my son and I are my household. My roommate is not. I will be using '2' (my son and I) as my household size, not my roommate (3).
I am head of household on my taxes and my household is 2.

Further, I am claiming only my half of expenses. (ie, claiming half the rent that I actually pay as rental amount, not the full amount). Therefore, there is no need to put the roommate anywhere.

Are you trying to use your roommate in household size? that could be your trouble.

[Beeheery]

Hi Sid-It's actually the opposite. I don't want to use a two person household @ all. I don't need to. I don't make ANY money at all for the most part. I am WELL WELL WELL under the income for a one person household. I'd like to not have to include anything about my roommate at all. I want to just include my income (next to nothing) but because I have almost no expenses (he lets me live there for free, he pays utilities etc), they are telling me I have to include his income. So...I just don't even know what to do at this point. He doesn't give me any money to split bills-they are all under his name and he pays them. This is soooo frustrating and sooo confusing!

[bigtim6656]

I hope not I live with my mom and dad and they make just over 55k a year. Seems stupid to me. Could be he wants to be able to count the expenses as yours.

The attorney I spoke with recommended I relocate to a homeless shelter or move in with a poorer friend for a minimum of 180 days and then file. SERIOUSLY???? Puhlease.

[tcreegan]

roommate excluded

Hi all,

Beeheery, I would definitely get another opinion...the law is pretty clear:

If roommate pays any of your share of the expenses, that needs to be reported as income but not the income of the roommate.

If roommate does not pay any of your share of expenses, their income is not reported.

The US Trustee uses the IRS method of determining household size: debtor, spouse, and dependents. Use IRS Pub 501 for definition of dependent.

In re Bostwick, 406 B.R. 867 (Bkrtcy, Minn 2009) roommates share of expenses is used as income on the means test but NOT the roommates income.

So there are two approaches:

The household is split and each side operates as a separate economic entity.
You file as a household of 1, expenses and rent are your half.

The household is not split evenly, each side does not operate as a separate economic entity.
You file as a household of 2, all expenses are claimed and part of expenses paid by roommate is included in your income. Roommates income is NOT included in your income.



A law search shows that most cases are for people trying to expand household size to get in a better bracket on the means test.

However, many of these cases have weight for the I want to exclude my roommate issue.

Confused yet? I sure am.....

Tom in Colo

[Beeheery]

Hi TC-
My problem is is that I have NO expenses. I don't contribute ANYTHING towards, rent, utilities, etc. My only expenses that I pay for are for my cell phone, food and gas. That's it. So that's my problem. They say I have to include free housing as income. But I dont pay anything and we don't split any bills. I just basically live there rent free. I'll call a few more lawyers in the am. Maybe they aren't understanding what I am saying. Thank you for your help and I happily join you in the confusion. A

[Beeheery]

And to make it even more confusing, he might be actually getting a real, paying roommate to help with the bills before I file. (Head spinning).

[backtoschool]

A roommates' income should never have anything to do with someone else's eligibility to file. If it is not their debt, and yours solely, I don't see how legally it could matter if they make 100K or 1 million a year-they are NOT responsible for your debt. I don't know why in the world or how it is legally possible to not allow someone to file Ch. 7 due to someone else's income. I had an attorney a couple weeks ago tell me I am ineligible to file CH. 7 because my roommate makes over 100K a year. It doesn't make any sense at all.

You need to be careful here Beeheery. If you are claiming the entire rent and utilities and living expenses on the means test (and not just your half) then the roomate's income is also counted in the means test.

If you are paying no rent, then the rent or mortgage is, is counted as income on your means test. In relation to bankruptcy there is no such thing as no living expenses. If you are living with someone who makes 100k a year and therefore doesn't charge you rent or living expenses, as far as the bankruptcy court is concerned, that means you should have that rent and expense money you are saving to pay your creditors. All the money you are saving in expenses each month will be counted as income that could have gone to pay your creditors.

The only way I see for you to be able to file chapter 7 at this time will be to get an apartment on your own, at least for the next six months or so while you prepare to file and go through the process.

[bigtim6656]

I think our right but wrong to, just because you live with someone and do not pay rent does not mean you do not have money to pay people. If you make 800 a month and pay out 780 a month in other bills then you have no money. I would think you can claim what you pay and be done with it.

You need to be careful here Beeheery. If you are claiming the entire rent and utilities and living expenses on the means test (and not just your half) then the roomate's income is also counted in the means test.

If you are paying no rent, then the rent or mortgage is, is counted as income on your means test. In relation to bankruptcy there is no such thing as no living expenses. If you are living with someone who makes 100k a year and therefore doesn't charge you rent or living expenses, as far as the bankruptcy court is concerned, that means you should have that rent and expense money you are saving to pay your creditors. All the money you are saving in expenses each month will be counted as income that could have gone to pay your creditors.

The only way I see for you to be able to file chapter 7 at this time will be to get an apartment on your own, at least for the next six months or so while you prepare to file and go through the process.