Receiving a bonus post filing but before 341?

[Diesel73L]

Back in May I took on a temporary assignment at my job because it paid a little more than my regular job, but it only lasted until last week. Even with the extra income we were still below median because my wife is unemployed and we qualified for CH7 no problem. Part of this temporary position was some sort of bonus at the end but I had no idea how much. When we sat down with our attorney I mentioned this and he asked how much-I said "maybe $1000" to which he replied "not an issue." Our home is underwater so we have exemptions on top of exemptions on top of exemptions and not much property or cash to protect. Our BK was filed November 30th, we got our paperwork for the 341 meeting (early January) and everything is going as planned. However, I just now got word that on Friday I will be receiving a check for $4000 (well, probably $3500 or so after taxes) as a bonus-much more than I thought I would get. I don't think it matters in terms of our six month lookback because that's already been done, but will the trustee balk when he sees our bank statements at the 341? I of course asked the attorney about this as well but getting back in a timely matter is not their strong suit.

[AngelinaCatHub]

At your 341, one of the stock questions is; "has anything changed since you filed your documents" and/or words of that effect. This has to be declared as 1K is pennies but going 3.5, may put you into an asset case. If you do have other exemptions of wild cards, you could update your paperwork very quickly. Not sure how soon your 341 is but you should then ask your Trustee was he aware your paper work was amended? If he says yes, the stock question can then be honestly answered no. Your and all's best bet in BK is total honesty. This buys a LOT of forgiveness for ignorance which I was a professional at in our bk. We so screwed up that for many reasons we should have been dismissed, but it was so apparent our lack of guidance that we got through it all, but expensively. 'Hub

[justbroke]

This is an appropriate thing to not only disclose to your attorney, but lean on him/her for advice. If the bonus was contingent yet unknown, there may be a requirement to have listed it in the petition as "unknown" bonus and then to exempt it. Perhaps your attorney already exempted the "potential" $1K of the money. Some (trustees and attorneys) see earned but not yet paid commissions as contingent income that is subject to being property of the Estate (much like over withheld taxes not yet refunded are considered property of the estate).

We can sit and speculate all day, but this is definitely one for your attorney. In my District in Florida, the Trustees would probably say that this is income that was earned prior to the petition being filed, and might try to claw at it.

[kornellred]

Yearly bonuses, short-term incentive payments (another term for bonuses) are actually a large employer's method of not having to fold a significant amount of money into an employees base wage.
Be that as it may, these often tidy sums of money become problematic in bankruptcy, especially Chapter 13 bankruptcy, where a debtor's earnings can get unfairly skewed to the upside in the 6 month look-back period when the bonus payment has to be included.
In my own case, I filed for Chapter 13 in March 2008. As it turned out, I received my yearly bonus a day or two before the 341 meeting. I brought the cash to the 341 meeting, assuming that I would have to surrender it to the trustee. I asked my attorney if I should simply surrender the money to the trustee on the spot. He asked if my bonus was a guaranteed part of my compensation package. I replied that, no, it was a performance-based bonus that was in no way guaranteed. He told me not to mention it unless the trustee asked about it. The trustee did not. I kept the bonus money.
I was 100 percent honest and I followed my attorney's advice.