Determining Household size.... have questions

[azdavid]

I am a single person contemplating a chapter 7. I have 2 children living with me since the beginning of the year. With a household of 3 I pass the means test just barely but I pass. My question concerns the fact that the kids mom claimed them as dependents on previous years tax returns. I will be claiming them this year but will probably be filing before next tax years tax time. I know that they want a copy of the most recent tax return is this going to be an issue since they will not be shown on my tax return ?



Thanks for any advice

[justbroke]

Are they "your" children. If they are your children, then you can always count them as part of the household. If they are your "girlfriend's" children, it gets messy. The trustee may probe your case a little, but being under the median is not a solution to not being on the radar! Generally speaking, being under the median just causes you less scrutiny. The key is having the right expenses that reduce your "disposable monthly income" to an amount so low, that a Chapter 13 is "useless". (That number is about $200/month.)

Again, if they are your biological children, or a related person (through marriage or otherwise) and are living in your home, then they are dependents for purposes of the means test.

[azdavid]

Thank you for the quick reply. Yes they are my biological children.

thanks again

[Brasky]

While the term "dependent" is used throughout the Bankruptcy Code, there is no single definition of it. As a result, bankruptcy courts have resorted to their own definition of "dependent" and have varied considerably in acknowledging a "dependent" relationship.

Therefore, no one really knows what dependent means. It probably includes biological or related persons living in the home. It also may include unrelated persons living in the home. There was a case where a debtor did not include the unrelated person living in the home in their household size, the trustee found this out, and moved for a motion to dismiss for abuse.

[azdavid]

Yes I have heard and read alot about the gray fuzzy area with regards to household size. My main concern is the trustee doesn't see them on my tax return if that will cause any issues. Or do they just mailny use the tax return to verify income .

[daylate]

Just my opinion but I would think a sharp trustee might pick up on the change and ask some questions. It would seem to me and this is purely common sense, logic based - that if you file after July 1, when the kids have lived with you for 6 months plus I'd think you'd be pretty safe.Also to be considered is the answer to where will they live going forward? If with you then I think your case is strong-if back to mom is the answer then not so strong. Again just a common sense way of looking at it.
Good luck.