Relocation assistance count as income for Means test?

[Cavedog]

So we get a letter today from Bank of America stating that we may be eligible for up to $3000 in relocation assistance if we agree to a short sale or DIL. We are 8 months behind on our mortgage and moving into a rental home July 1st with plans on filing in November Ch7. An extra $3000 might put us over the means test figure for a family of 4. Anyone know if this would count as income?

[debee]

Hi cavedog,

I don't know whether or not you'd have a little fight on your hands over the 3K one-time moving incentive. Since it's a one-time thing you should be able to rebut any objection. I would talk to your lawyer about it.

Also, being above median income isn't an automatic fail. You need to run your expenses through a means test and see how you come out.

If you can pass the means test once you enter your expenses, you can still file a chapter 7. The real determiner then will be your schedule I/J.

Have you done a trial run means test?

[daylate]

I'm not sure about the relo either but it seems debee advice is right on-not having your situation I'm not all that familiar with the details of a short sale before a bk but if you go that route just make sure you are not winding up with "income" from it. I'm thinking that Congress has passed a temporary law that protects you for now but just make sure. Good luck.

[Cavedog]

Thanks to both of you for the advice. We do have a lawyer and I will ask him this question. I like to get the view points on this forum before I ask him as oftentimes I pick up some good thoughts and alternatives. We are comfortably below the means figure ($28,000 vs $32,500), but dont want it to close with the $3000.

We have not done a trial means test. I have seen websites that will do that for you. Is that pretty accurate, or should we have the lawyer do that? I don't know why, but I feel like I am wasting the lawyers time(pestering would be a good word) if I ask him these type questions. He has been great to work with, and he hasnt said anything like that. Just a thing with me.

[debee]

If you're below median, there is no point doing the means test. You will pass it as soon as you enter your income. If you want to play around with it, then increase your income to $1 above median. I wouldn't do it myself instead of having my attorney run it, I would do it in addition to having my attorney do it. There have been many cases of people on this very forum whose lawyers flubbed their cases up. The more you know about this process and your case, the better off you will be. (In my opinion).

This is an easy one to use: http://www.legalconsumer.com/bankruptcy/nolo/ There are explanations in the margins. You can also run searches on the forum or start a thread to learn more about how to fill it out if you're not sure what's allowed and what isn't. It's handy in that in fills in your county expense amounts for you, and has the other amounts (medical, auto, etc) right there so as you enter the number of cars with payments, it does the math.

Calculate your 6 month income with 13 checks if you are paid biweekly.

Don't worry about getting close to the median with the 3K. It's an either/or thing. If you're under - even a dollar under - you don't have to do the means test at all. Also, don't be afraid of the means test. Depending on your circumstance, you may easily pass.

EDIT: But if you're under median even counting 13 checks and adding the 3K, then you pass it. No point playing around. You're in the clear and can move onto messing around with your numbers on schedule I and J.

[Cavedog]

Thanks Debee for the info. I was happy to see you specifically respond to my post. Your advice has been great!