Quick look back question

[ruttie]

no, my instructions from the trustee were, the last 2 paystubs( the one the week prior to filing and the one for the week of filing, we filed on a Friday, so the wages we made Mon-Thurs, before the file date, he wanted to see the pay stub) which I would not receive until the following week. The exemptions state that only 75% of earned but unpaid income is exempt. They also want to see your bank statements up to the day you file, so you had better spent down any money on legit expenses, because anything in there over the exempt amt. is the property of the trustee. They calculate income for the last 6 months with the means test, but you do need to acct. for any money up to and including the date you file

[ruttie]

I am an asset case, but this is still common practice with them wanting to see your wages up to the date you filed. you could have your means test at the end of the month, and the following week get a big check, and then file, but you still have to show whats in your bank acct. up to & including the day you file. we have raw land that may or may not be considered an asset, but that has no bearing on what we still had financially in the bank.

[Freddy03]

What I am trying to do is figure out my DMI so I need to most accurate answer to my question..LOL

Anyone?

[tobee43]

I am an asset case, but this is still common practice with them wanting to see your wages up to the date you filed. you could have your means test at the end of the month, and the following week get a big check, and then file, but you still have to show whats in your bank acct. up to & including the day you file. we have raw land that may or may not be considered an asset, but that has no bearing on what we still had financially in the bank.

no, it's really not that common in a non asset chapter 7...most times in that case many of the questions have been answered prior to your 341.

in this state they ask for 2 year taxes...(we provided 3) and 6 months up until the date of filing. unless there are questionable or there are questions about your income from the trustee that is all that is required. however, in asset cases it is treated differently.

[daylate]

The law seems pretty clear-only income RECEIVED in the prior 6 months is to be included in the calculation of your last 6 months income...now as to the exemption for unpaid wages i can see why they would want to see a pay stub for a paycheck issued on day 1(or any other) of the month following your cutoff. But these are two different issues. I would agree with tobee that if there is a question about your income then looking at the next few may be warranted but unless something funny was going on it shouldn't be included in your 6 months for the means test. As to Schedule J income that is forward looking and you should consider your July 1 check the starting point for projecting your income.

[LadyInTheRed]

There seems to be some confusion here between reporting a paycheck for your DMI calculation and reporting it as an asset.

For calculation of DMI, you use the paychecks you received in the six calendar months before you file. The law that Debee quoted is clear about that. So, if you file any time in July, whether it be July 1 or July 30, you use January through June on the means test.

If you file on July 1 and get paid the same day, that paycheck is an asset that must be reported. Any wages you have earned, but have received as of the date of filing should be listed on your petition as an asset, even though it is not part of the 6 month look back for DMI. So, you could get paid a week or two after filing BK and, depending on how your pay periods fall, at least a portion of that check may need to be listed as an asset.

[DAE]

So, you could get paid a week or two after filing BK and, depending on how your pay periods fall, at least a portion of that check may need to be listed as an asset.

As a case in point, as I was observing a 341 hearing yesterday, the Trustee had a question about a school teacher's income. While the school teacher earns a paycheck year 'round, it was the Trustee's position that the earning of the money paid in the summer (presumably when the teacher is NOT in the classroom) occurred during the prior nine months. So if the teacher filed on June 1 (and the school year was complete), the teacher would have already earned the wages that she will be paid over the summer months while not in the classroom and therefore that money was under the control of the Trustee as money earned (although not paid).

[tobee43]

the dmi is usually done before the 341...LOL!!!

i'm NOT the thinking the trustee will have you re-do your dmi on the spot, at least not the trustee we had....

i hope you get he,r freddy, she was really nice, and had a good sense of humor. as well, as her office was exceptionally efficient, as they contacted us directly prior to our 341 on numerous occasions to answer any questions prior to the hearing.

what i figured out, was this particular trustee, just wanted to make certain prior to the 341 if there was a chance it may become an asset case.

i still brought everything but the kitchen sink to cover ourselves, for that just in case situation, oh...wait!!!!, LOL!! the kitchen sink WAS in the truck.. really, i think it's going to fine.

DAE...very interesting with respect to viewing the teachers income timing.

[Freddy03]

There seems to be some confusion here between reporting a paycheck for your DMI calculation and reporting it as an asset.

For calculation of DMI, you use the paychecks you received in the six calendar months before you file. The law that Debee quoted is clear about that. So, if you file any time in July, whether it be July 1 or July 30, you use January through June on the means test. If you file on July 1 and get paid the same day, that paycheck is an asset that must be reported. Any wages you have earned, but have received as of the date of filing should be listed on your petition as an asset, even though it is not part of the 6 month look back for DMI. So, you could get paid a week or two after filing BK and, depending on how your pay periods fall, at least a portion of that check may need to be listed as an asset.

Thanks so much! This is what I was looking for.

I was getting confused with the other questions being asked in this thread.

[Freddy03]

The income reported on the Means Test is "current monthly income" which is defined in 11 USC 101:

"(10A) The term “current monthly income”—
(A) means the average monthly income from all sources that the debtor receives (or in a joint case the debtor and the debtor’s spouse receive) without regard to whether such income is taxable income, derived during the 6-month period ending on—
(i) the last day of the calendar month immediately preceding the date of the commencement of the case if the debtor files the schedule of current income required by section 521 (a)(1)(B)(ii); or

Thanks!! I must have missed this post.

[debee]

Sorry, but I just found another little tangle to throw into the knot:

In re Bernard, 2008 WL 5050132 (Bkrtcy.D.Mass.2008) and In re Burrell, 399 B.R. 620 (Bankr. C.D. Ill., 2008).

Freddy, I think you need to talk to your lawyer about how the statute is interpreted in your district because at least one court has ruled that what counts is whether the income is received in the 6 month lookback, and at least one other court has ruled that it doesn't have to be rec'd in the 6 month lookback, only derived (aka: earned).

Both words are in the statute, but may be interpreted differently depending where you file. If it were me, I would make sure my numbers worked when the bonus was counted. That way you're covered/safe no matter how your district interprets the statute.

edit: You also still have to sort out how to deal with it as an asset as well.

[Freddy03]

Sorry, but I just found another little tangle to throw into the knot:

In re Bernard, 2008 WL 5050132 (Bkrtcy.D.Mass.2008) and In re Burrell, 399 B.R. 620 (Bankr. C.D. Ill., 2008).

Freddy, I think you need to talk to your lawyer about how the statute is interpreted in your district because at least one court has ruled that what counts is whether the income is received in the 6 month lookback, and at least one other court has ruled that it doesn't have to be rec'd in the 6 month lookback, only derived (aka: earned).

Both words are in the statute, but may be interpreted differently depending where you file. If it were me, I would make sure my numbers worked when the bonus was counted. That way you're covered/safe no matter how your district interprets the statute.

edit: You also still have to sort out how to deal with it as an asset as well.

Thanks! The bonus won't come into play b/c it was received in Dec and it was for 2010. I was just concerned b/c I am due a check on July 1st. It will be for the last 2 weeks worked in June. I wasn't sure if that check is counted for my 6 month lookback.

And if I file on July 12th - it wouldn't be an asset b/c I would have paid my mortgage a week before.

I just did the math with the check included and I still come up with a -245 DMI so I think I'll be ok even if it is included. I passed the means test with or without the check also.

If I were to file say now the bonus would def put us with a possitive DMI (under $100) but b/c I'm in FL I don't want to push my luck.

[debee]

I typed "bonus", but I meant "check". That's what happens when you stay up too late on bkforum.

It sounds like you have it all worked out Freddy.

If your district counts only income rec'd, then you wouldn't count it.

But if your district counts income earned, then you would count it, but then you would also probably drop a check at the beginning of the 6 month period. So either way, it probably works out the same. (So long as it's the same $ as the earlier checks)

Sounds like you're ready, Freddy.

[Freddy03]

I typed "bonus", but I meant "check". That's what happens when you stay up too late on bkforum.

It sounds like you have it all worked out Freddy.

If your district counts only income rec'd, then you wouldn't count it.

But if your district counts income earned, then you would count it, but then you would also probably drop a check at the beginning of the 6 month period. So either way, it probably works out the same. (So long as it's the same $ as the earlier checks)

Sounds like you're ready, Freddy.

Thanks! If only July would come faster!!

[BROKEDED]

For what it's worth, we filed March 22nd. We only provided paycheck info for the six complete months prior to that ending February 28th. It's obvious that there are as many different interpretations of bankruptcy law per district as there are differences in exemptions per state.