In CA, important question about filing then income increases almost immediately after

[AllMyFault]

Okay, so I plan to file in late January-ish.
I have a great job offer and they want me to start early February-ish.
My income will skyrocket and this would obviously happen before any discharge or even a meeting would take place.

How would this affect the filing?
Should I not take the job until.....x day?

Unfortunately my debt load is so large that my BK definitely takes precedence over taking said job.

[tcreegan]

Hi AllMyFault,

Sounds like you are the perfect candidate for a Ch 13....

Tom in Colo

[AllMyFault]

Hi AllMyFault,

Sounds like you are the perfect candidate for a Ch 13....

Tom in Colo

It would be a horrible 'business' decision for me to take the job in lieu of qualifying for and filing a 7..so that won't happen.
I guess my question made clearer is:
I file on January 1, 2011, I know the court looks back at financial history leading up to the filing, but do they look forward from the date of filing?
How long after filing can I begin to make money outside of the Chapter 7 income guidelines?

[LadyInTheRed]

It would be a horrible 'business' decision for me to take the job in lieu of qualifying for and filing a 7..so that won't happen.

It would be a horrible business decision to turn down a great job that would cause your income to skyrocket in order to avoid a Chap 13. You need to look at the long term, not just the short term.

I file on January 1, 2011, I know the court looks back at financial history leading up to the filing, but do they look forward from the date of filing?
How long after filing can I begin to make money outside of the Chapter 7 income guidelines?

Your Schedules I and J look forward. Even if you pass the means test, the trustee could object to a Chap 7 based on totality of circumstances. You should talk to an experienced bankruptcy attorney with knowledge of the case law in your district to find out if the trustee's objection would likely succeed.

[AllMyFault]

It would be a horrible business decision to turn down a great job that would cause your income to skyrocket in order to avoid a Chap 13. You need to look at the long term, not just the short term.


Your Schedules I and J look forward. Even if you pass the means test, the trustee could object to a Chap 7 based on totality of circumstances. You should talk to an experienced bankruptcy attorney with knowledge of the case law in your district to find out if the trustee's objection would likely succeed.

Thanks for that..
Does anyone know how far ahead they would typically look?
As I said, I wouldn't do anything that would or could jeopardize the success of a Chapter 7, I'm just trying to find out how long I should wait AFTER FILING to start making serious money?

[tcreegan]

Hi again AllMyFault,

As I said, I wouldn't do anything that would or could jeopardize the success of a Chapter 7, I'm just trying to find out how long I should wait AFTER FILING to start making serious money?

....ouch, this is fraud....on your BK forms a question will be 'are there any anticipated changes in income' in the next 12 months. And you get to swear under oath 'is everything on these forms correct'

The old saying 'honesty is the best policy' applies well in BK....

Tom in Colo

[daylate]

I agree with Tom. from everything I've read and heard if you KNOW you have the job,you have to state it. If you were offered a job after your 341 and you didn't know about it at the time of your 341 from what I have read you're ok. Gray area exists in the time between filing and 341. But since you know now unless an attorney advises you otherwise I think you have to disclose.

[momofthree]

Why not file now instead? Your 341 will most likely be held in Dec or Jan....

[daylate]

I don't think filing now solves the problem. If you know for sure you have a new job or will have then I believe you have to disclose it. See Tom's post above for the exact wording of "next twelve months"

[AllMyFault]

Hi again AllMyFault,

As I said, I wouldn't do anything that would or could jeopardize the success of a Chapter 7, I'm just trying to find out how long I should wait AFTER FILING to start making serious money?

....ouch, this is fraud....on your BK forms a question will be 'are there any anticipated changes in income' in the next 12 months. And you get to swear under oath 'is everything on these forms correct'

The old saying 'honesty is the best policy' applies well in BK....

Tom in Colo

Thank you guys for the honest and probably sound advice...however, in my eyes nothing about BK is 'sound' and I'll bet few are completely 'honest' and my filing will be no exception. I'm no Sunday school choir boy if you know what I mean and right now my interest lies in doing whats best for myself and my family...PERIOD
For the record, I'm that guy that will ask his attorney; "How do I hide my asset's?
Just trying to be honest here.

[AllMyFault]

Why not file now instead? Your 341 will most likely be held in Dec or Jan....

Two reasons:
I'm waiting for some 'changes' I made a while back to season a little longer
I need to move cash out of a business before filing. (Yes, I know...it's being withdrawn and or used for legitimate business expenses)

[tcreegan]

however, in my eyes nothing about BK is 'sound' and I'll bet few are completely 'honest'

You would be mistaken around here, most of us are rigorously honest about it. That said, there are perfectly legal ways to 'pre-plan' for a BK, and doing what is best for your long-term financial interest is the whole point of filing. For most of us, events out of our control made a BK a perfectly 'sound' decision.

Good luck w/ your situation, hope it works out for you,

Tom in Colo

[LadyInTheRed]

Thank you guys for the honest and probably sound advice...however, in my eyes nothing about BK is 'sound' and I'll bet few are completely 'honest' and my filing will be no exception. I'm no Sunday school choir boy if you know what I mean and right now my interest lies in doing whats best for myself and my family...PERIOD
For the record, I'm that guy that will ask his attorney; "How do I hide my asset's?
Just trying to be honest here.

You aren't likely to get people to post info in the forums to help you figure out how to be anything other than honest.

It is unethical for an attorney to tell you how to hide assets. If an attorney will disregard ethics to help you, how do you know he won't disregard ethics in a way that will harm you? Are you willing to trust an attorney who does not take ethics rules seriously?

Before you are anything other than honest in your BK filing, think long and hard whether it's worth having your case dismissed and all of your debts becoming non-dischargeable, not to mention a fine of up to $250k and/or 5 years in prison if you are convicted of fraud.