Income increase after filing?

[basketsbears]

Hi,

I have seen a job posting on my employer's website that I may apply for. I doubt I would get it as I graduate next May and would be looking for a new job. If I was able to get this job, my income would increase dramatically by about $1600+ gross monthly. If we have filed (planning on filing end of month or first week of July) and I would receive this job, which is not likely, could the trustee make us go into a 13?

Thanks for all the help!

Lynn

[despritfreya]

If you have been offered the job as of your filing date (but just have not started) then yes, it could be a problem. If you simply have applied for a position and no offer has been made to you, it is not an issue.

Des.

[Bell30656]

This happened to me. I posted about it in these forums a few years ago but can't locate it now. Basically after my filing but before my 341, I was promoted. The promotion came with a substantial increase in pay and a bonus. Worse, the promotion was announced in the newspaper. After the initial excitement faded, I dropped by my attorney's office to chat about it. He told me not to worry about it. That it was fine.

Still nervous about it on the day of the 341, I brought it up again. When my turn came at the 341 we were whipping right through all the trustees questions and documentation when my attorney brought it up. He explained to the trustee that I had no knowledge of this on the day of my filing. He even gave rough figures demonstrating how much change it would make in my income. The trustee shook my hand and congratulated me on the promotion. He explained to me that filing a chapter 7 isn't a movie but rather a snapshot based upon one day. The day you filed. He did say there are a few exceptions but a promotion isn't one of them.

[basketsbears]

If you have been offered the job as of your filing date (but just have not started) then yes, it could be a problem. If you simply have applied for a position and no offer has been made to you, it is not an issue.

Des.

Thanks! I haven't even applied. I am a nurse, going to graduate school. Right now I am working on an as-needed basis for two companies. I saw what they call "weekend option" position available, which you work 24 hours, every Sat & Sun, and get paid 36 hours - so it would be like I was back to full-time employment. So I have no idea if it is even possible that I would get a job like this, but it sure would help to get back to full-time employment. Otherwise, will just hang on until May 2013.

Thanks Des. By the way - I have read so many of your posts, and I have learned so much. Thank you for the wealth of information you have provided all of us.

Lynn

[basketsbears]

This happened to me. I posted about it in these forums a few years ago but can't locate it now. Basically after my filing but before my 341, I was promoted. The promotion came with a substantial increase in pay and a bonus. Worse, the promotion was announced in the newspaper. After the initial excitement faded, I dropped by my attorney's office to chat about it. He told me not to worry about it. That it was fine.

Still nervous about it on the day of the 341, I brought it up again. When my turn came at the 341 we were whipping right through all the trustees questions and documentation when my attorney brought it up. He explained to the trustee that I had no knowledge of this on the day of my filing. He even gave rough figures demonstrating how much change it would make in my income. The trustee shook my hand and congratulated me on the promotion. He explained to me that filing a chapter 7 isn't a movie but rather a snapshot based upon one day. The day you filed. He did say there are a few exceptions but a promotion isn't one of them.

Thanks Bell. I like the example of a "snapshot" not a movie. That makes things much easier to understand.

[Pizza]

Aren't you required to disclose 'anticipated' increases in income when you file?

[basketsbears]

Aren't you required to disclose 'anticipated' increases in income when you file?

Well, I haven't applied for any job yet, so I don't have anything anticipated.

[Pizza]

Well, I haven't applied for any job yet, so I don't have anything anticipated.

Right. The mistake could be waiting to file and receiving a job offer in the meantime. Same thing with promotions. The proper time to file would be before any increases in income are anticipated. The following is one of many such statements I have found that reads about the same:

It is unlikely the bankruptcy petition has to be amended if your income increases after the case is filed. This is because the bankruptcy petition, which is a document whose accuracy you have verified under penalty of perjury, is supposed to accurate as of the date you signed it, and as of the date the case was filed.

The bankruptcy petition is not required to be amended after filing every time something changes regarding your debts, assets, monthly budget or anything else. (The sole exception is inheritances arising in the 180 days after filing the case.) Otherwise, you would be amending your bankruptcy petition every hour after filing the case, forever, as your bank balance changes, your cash on hand is spent, your house payment changes, you buy a different car and junk the old one, you pay your dentist for the small bill you listed in the bankruptcy, and so on.

Accordingly, if your income was listed correctly on Schedule I as of the time of filing the case, you have no duty to amend your petition, even if your income increases. However, keep in mind that Schedule I contains a question asking for any increase or decrease in income that you anticipate in the next one year. If your income does increase shortly after filing, and you anticipated that could happen, then that fact should have been noted on Schedule I. If it was not, you have a duty to correct that misstatement by immediately amending the petition.

Also, at the meeting of creditors (which usually occurs about thirty days after filing), the trustee will likely ask you under oath if anything has changed since the date the case was filed. Thus if your income has increased you probably will have to tell the trustee about it at this meeting. After such a disclosure, your lawyer may decide as a tactical matter that the petition ought to be amended.

[basketsbears]

Thanks everyone. I will probably stay put because even though the increase would be great, I doubt they would hire me as I will be getting out of school in May.

I did just receive a 70 cent pay increase which will go into effect in the next couple of weeks. I will let them know about that.

Thanks again!

Lynn