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**confusedinVA** · 08-08-2006, 02:44 AM

I think I can help a little, but you will have to wait for someone more knowledgeable on some of this stuff.

1st, yes, you have to claim your childcare money to the IRS. Since it is only 150 per week that you are making, you wont owe much tax on it, if any. You can deduct a portion of your rent, food, supplies etc as expenses of your new business. As far as reporting that income for bk purposes, I would. I also do childcare and am watching more than 1 child. I have included all of the money that I am making. To risky for me not to. I would be the one to get caught and thrown in jail. I dont even accept checks. I only accept cash and I still would be to nervous not to report that money. I am curious to see what the others suggest on this.

Good luck.

**lrprn** · 08-08-2006, 05:43 AM

Welcome, monlyba! Glad you found us! My suggestions are below inside your post in red.

Originally posted by monlyba

i'm curious to see what "hoops" i have to jump through now that the laws have changed - i don't know very much about what is different now, other than it's supposed to be "harder" to file.

Yes, the new bankruptcy law passed last October made the 'hoops' more complicated, so lawyers are charging more now. Also the filing fees have gone up as well. It's still very possible to file though - many of us here have successfully filed both Ch 7 and 13 since the new law was passed.

in a way, i feel like this will be an easy process due to my current life situation, but i'm not so sure. i'm not employed right now, haven't been since June. my boyfriend works and pays all our bills (we live together) and i stay home and take care of the baby. i only have a couple hundred bucks in my bank accounts but they will be drained soon i'm sure. i am financing a 2004 car but am upside-down (i think i owe about $11k and "the book" says it's work about $9k i think). i have a lot of old credit card debt from stupid college years when they gave me like SIX VISAS, a MC, a DISCOVER, SEVERAL dept store cards, gas cards, etc.

like a dummy i maxed them all out within a few years and shortly after graduation it became impossible for me to keep up with even the minimum payments. i haven't paid any of them or even paid much attention to them since about '02. i get collection agency letters almost daily and usually throw them out. i do check my credit report periodically just out of morbid curiousity and the debts have been sold and resold so many times, i have no idea what most of them were originally. i also have student loans of about $40k

that i will obviously have to deal with eventually.

Your story is a very familiar one here, so don't worry about not being supported by this group. Were your student loans through the government or private? What state are you going to file in? (I'm asking because there are differences between the states about income medians and exemptions. If we know your state, we can be more helpful with answers to your questions.)

my main questions/need for advice are about the car. i NEED a vehicle (my boyfriend doesn't drive so i HAVE to). i don't necessarily care about keeping the one i have - honestly i'd love to not have the $369 car payment every month. but i have tried to get a cheaper car and due to my negative equity and bad credit, no one has been able to help me unless i had $3-4k for a down payment (YEAH, right). i'm thinking i should not include it in the bankruptcy so that i can keep it... but then again i'm not so sure. i wonder if i would be able to get another car if i included it? can anyone advise me on that?

If this one car is your family group's sole means of transportation and you don't have the means to purchase another (even a junker), then you need to keep it. Was it purchased more than two years ago? Again, knowing your state will help us give better advice here.

also, i'm wondering about the income situation. *technically* (legally) i have no income. i did just last week start caring for a baby at home for $150 per week. the mom pays me with a personal check. i wasn't planning on filing taxes on it but i'm wondering how that works. do i need to declare that as my income even though it's "under the table"? (i'm also wondering if at tax time she will tell me she wants to get a deduction for childcare - i guess i need to have that discussion with her so i'm not screwed come April). since my boyfriend and i are not married, his income is irrelevant, correct? even though he is "taking care of me" right now? he doesn't make a lot of money, by any means - his income barely takes care of our bills. i just wonder how to answer questions about expenses, since i'm not really paying any myself (except maybe a utility or two with that babysitting money).

Agree with ConfusedInVA - you need to declare your babysitting money. The mom certainly will on her taxes, and it's a huge risk to hide money from the trustee - that's fraud and can get your case dismissed (a very bad thing). About your utilities - the IRS sets a certain amount that is allowed for utilities in each state. This is what your lawyer will use on your bk forms. However, since you don't pay the utilities yourself, that makes for an interesting dilemma. When folks don't have a car or have paid off their car, the courts have ruled that the filer cannot claim the transportation exemption. If you don't pay your utilities, then there's a chance you won't be able to claim the utilities exemption. Your lawyer will have to advise you about this.

i'm also dreading gathering up all the creditor info. like i said, my credit report is a MESS and i am not sure what is going on with all of it. i know the attorney wants a list of accounts, creditor names/addresses, account numbers if possible, etc. i have totally ignored most of these accounts for so long that i don't know where to begin. do i just call the toll-free numbers beside each creditor on the report and ask them where the account originated? are they really going to supply me with this info freely? it's all so confusing and i dread making 20 phone calls to people who want money from me!

Ask your lawyer about what to do in this situation. You definitely need to start keeping all of the creditor and collection agency correspondence with their original and return mailing envelopes that come in the mail.

OH... i just thought of something else. i have like $150 in an IRA and i'm not sure how much - probably a few thousand bucks - in a retirement account (sorta like a 401k... i think it's called a 457) from where i used to work. what will happen to these? i'm so terrible with this stuff. i hope this mess will help me turn over a new leaf with managing money.

No worries here - retirement money is protected and can't be taken from you during bankruptcy. Just don't take any money out of either account before or after you file!

sorry this is so long, i tend to ramble. i look forward to your responses and learning from your experiences! thanks...

Know that we are here for you any time you need support, have other questions, or just need to vent frustration. You are starting on a journey with lots of ups and downs, but you are doing the right thing by trying to get control of your financial life and change your habits so you don't find yourself here again. Welcome!

**monlyba** · 08-08-2006, 05:39 PM

thanks for your responses! i need all the advice and guidance i can get. even though i have learned a lot about this process, i still feel really overwhelmed and confused.

i'll be filing in North Carolina. my student loans were originally through the government, but they have been reconsolidated by a company that appears to be run by citibank. does that mean anything?

it has been 2 yrs (in June) since i purchased my car. i would love to get rid of it since the payment is so high (i think i got duped by the dealer, plus since my credit was bad i got a high interest rate i guess). i was going to see about getting a cheap used car through some guy who does his own financing but doesn't check credit reports (so i was told by a friend who has bought 3 cars from him) but i never got around to it, and now i'm not so sure if that's a good idea. i guess since we can manage the car payment, i will just keep it... but it would be wonderful to reduce that bill.

about the utilities - they are actually all in my name (power, cable/internet/phone, my cell phone). both our names are on the apartment lease, too. and since i'm technically earning $600 a month now, i am able to pay some of those bills with my income.

i'm relieved to hear that they won't touch retirement money. i *did* empty out a different retirement account a couple months ago, to help us pay bills when i left my last job. will that affect anything, you think? the state took out about 30% in taxes before i even got the check.

the attorney will want the name of all creditors, even if several agencies/companies at one point or another have dealt with the same debt... is that right? i mean if my Discover card balance was sold to abc agency one year then 3 years later sold to xyz, inc. i would need the contact info for all those places, yes? all my original credit card companies show $0 balance (chargeoff) beside each one on the credit report, and *some* of the collection agencies listed have a clue beside them about where the original debt came from... but as i mentioned, there are a few on there that i'm really not sure about.

one more question... medical bills can be included in bankruptcy, right? i owe the hospital quite a bit of money from when my daughter was born, both for myself as well as her. i had insurance but it didn't cover everything, and she didn't have any insurance for her first few months. can i include the bills for her, or will they try to go after my boyfriend (her father) for those? also, would we have a problem getting treated at a hospital/doctor's office if i include money i owe them in my bankruptcy?

thanks for any help anyone can give me, i really appreciate it! i know i can ask my attorney all or most of these questions, but one thing i have learned from browsing this forum is that sometimes lawyers will give you different answers to the same questions, so i would love to see what you guys think so i can compare to whatever he says.

**CAB_44** · 08-08-2006, 05:53 PM

Hi Monlyba~
Welcome~ I'm new myself~ just read what these great folks are telling you, and it will carry you through~ I"m sorry not to be of much help~ but I understnad how you're feeling....chin up sweetie~ there are plenty of people here to help you!!
CAB_44

**monlyba** · 08-09-2006, 08:11 PM

thanks! hopefully soon i will make sense of all this and get started in the process.

**lrprn** · 08-09-2006, 08:57 PM

Check out my red responses below in your post....

Originally posted by monlyba

thanks for your responses! i need all the advice and guidance i can get. even though i have learned a lot about this process, i still feel really overwhelmed and confused.

i'll be filing in North Carolina. my student loans were originally through the government, but they have been reconsolidated by a company that appears to be run by citibank. does that mean anything?

After the new bk law was passed last fall, it's very doubtful that your student loans can be discharged unless you can meet a set of very stringent guidelines, and almost no one can meet them. However, you might be able to work out a payment plan - you won't know unless you try.

it has been 2 yrs (in June) since i purchased my car. i would love to get rid of it since the payment is so high (i think i got duped by the dealer, plus since my credit was bad i got a high interest rate i guess). i was going to see about getting a cheap used car through some guy who does his own financing but doesn't check credit reports (so i was told by a friend who has bought 3 cars from him) but i never got around to it, and now i'm not so sure if that's a good idea. i guess since we can manage the car payment, i will just keep it... but it would be wonderful to reduce that bill.

Since you bought your current car two years and a month ago, if you can wait to file for just a few more months, that would be a big advantage for you because it will wipe out the high interest and bring the car's value down to what it's actually worth in the market. The bk 'rule' is that there needs to be at least 910 days between buying the car and filing to get this to happen. Otherwise, you'll be responsible for the full loan value even if it's a lot more than the car is worth.

about the utilities - they are actually all in my name (power, cable/internet/phone, my cell phone). both our names are on the apartment lease, too. and since i'm technically earning $600 a month now, i am able to pay some of those bills with my income.

If you file, the state you live in sets the total amount you are allowed to use for most utilities on the means test. You don't want to file bk owing utilities money if you can avoid it. They can ask you for a very large deposit down if you ever have to move to another location. BK stays on your record for 10 years and the utilities check your credit reports before turning on service, so you better be sure you are going to stay in place for a decade if you file listing a utility as a creditor.

i'm relieved to hear that they won't touch retirement money. i *did* empty out a different retirement account a couple months ago, to help us pay bills when i left my last job. will that affect anything, you think? the state took out about 30% in taxes before i even got the check.

You may get another unpleasant surprise when you file your federal return next year. Might be a good idea to have some help from a tax expert - it's quite a penalty for early withdrawal from a retirement fund.

the attorney will want the name of all creditors, even if several agencies/companies at one point or another have dealt with the same debt... is that right? i mean if my Discover card balance was sold to abc agency one year then 3 years later sold to xyz, inc. i would need the contact info for all those places, yes? all my original credit card companies show $0 balance (chargeoff) beside each one on the credit report, and *some* of the collection agencies listed have a clue beside them about where the original debt came from... but as i mentioned, there are a few on there that i'm really not sure about.

The only way to be absolutely certain that a creditor cannot come back years from now demanding payment is to list every single one of your creditors, including all the collection companies, on your bk creditor list when you file. Your credit reports can help with this - it isn't perfect, but a fair number of your old creditors and collection agencies may still be listed there. You can get a free credit report once a year from https://www.annualcreditreport.com/cra/index.jsp

one more question... medical bills can be included in bankruptcy, right? Right. i owe the hospital quite a bit of money from when my daughter was born, both for myself as well as her. i had insurance but it didn't cover everything, and she didn't have any insurance for her first few months. can i include the bills for her, or will they try to go after my boyfriend (her father) for those? Since you and her father aren't married, unless he signed something that he would also be responsible for the baby's bills, then hospital collections can't come after him. also, would we have a problem getting treated at a hospital/doctor's office if i include money i owe them in my bankruptcy? Yes, there's a chance the doctor may ask you to leave the practice, at least until after you've received your discharge. Sometimes this doesn't happen - depends on the practice. As far as the hospital goes, if it's an emergency, they have to treat you or the baby - that's the law.

thanks for any help anyone can give me, i really appreciate it! i know i can ask my attorney all or most of these questions, but one thing i have learned from browsing this forum is that sometimes lawyers will give you different answers to the same questions, so i would love to see what you guys think so i can compare to whatever he says.

Be sure to post back with what your lawyer tells you. We aren't lawyers here - just knowledgeable consumers - so it's always good to see if we are sharing sound information. Good luck - hope your time with your lawyer goes well!

**monlyba** · 08-10-2006, 05:29 PM

thanks SO much for your input. it really makes me feel better about this to have thoughts from several people, not just one attorney. i will have to come up with the money to file and that may be a while, so maybe i will be able to do that car thing you mentioned - but is that only for filing a ch. 13? i didn't know you could make any "deals" on repaying stuff with a ch. 7 bk. i had already figured i would have to pay all my student loans back. luckily they've been cool with letting me put off making payments for quite a while now since i haven't had any high or steady income in a while. oh, and as for utilities, i wasn't planning on listing any of them as creditors on my bk, i thought you were just talking about when i list my monthly expenses. i do owe money to the phone company that i will probably put on there, but i don't plan to ever have a traditional phone line through them ever again with all the cell and digital services these days.

**monlyba** · 08-10-2006, 05:30 PM

um... i thought this forum was about bankruptcy, not religion.

**steveiLife** · 08-02-2010, 02:56 PM

So Many Emotions!

I know in my own experience that it almost seems that our worth as human beings almost is tied to our credit score and financial situation! Life does happen and sometimes we just have to look at our options. It is not a judgement on us as persons, just on our financial decisions and situations that are sometimes out of our control. Here are some quotes I found valuable....

Bankruptcy represents a longstanding commitment in this country to helping people get a fresh start. This principle has never been giving only certain people a fresh start.
Tim Johnson

Capitalism without bankruptcy is like Christianity without hell.
Frank Borman

Disappointment is a sort of bankruptcy - the bankruptcy of a soul that expends too much in hope and expectation.
Eric Hoffer

Family responsibility, yes, and always. Family bankruptcy due to the cruel rules of government, no.
Barbara Mikulski

High bankruptcy rates, increased credit card debt, and identity theft make it imperative that all of us take an active role in providing financial and economic education during all stages of one's life.
Ruben Hinojosa

However, the economics of our business continued to deteriorate. We barely escaped bankruptcy a year ago, and in the aftermath of that escape we had to make some even tougher decisions.
Gerard Arpey

If we don't change, millions of American families are just one medical emergency, or one layoff, away from financial disaster and bankruptcy.
Jim Cooper

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hoping to file soon - so many emotions and Q's!

hoping to file soon - so many emotions and Q's!

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