Declining income consideration

[Lexy1969]

Question for the income situation.... I was on a guaranteed non-recoverable draw for Sept. Oct. November of 6k per month but now only making around 1500 per month. Im strictly commissioned now and have no idea what to expect in the future. Either it gets better or I get a second job or different company. My income in 04 was 100k then 05 was 82k then last year was only around 56k with the guarantees. Any idea of what they will ask of me? I dont have any projections of income but the short term isnt looking good but the potential of upside in the market means back to 100k plus.

[lrprn]

Question for the income situation.... I was on a guaranteed non-recoverable draw for Sept. Oct. November of 6k per month but now only making around 1500 per month. Im strictly commissioned now and have no idea what to expect in the future. Either it gets better or I get a second job or different company. My income in 04 was 100k then 05 was 82k then last year was only around 56k with the guarantees. Any idea of what they will ask of me? I dont have any projections of income but the short term isnt looking good but the potential of upside in the market means back to 100k plus.

Lexy, I don't understand what is your question? Are you asking if you are a bankruptcy candidate?

[HHM]

Income guidelines for Chapter 7 BK are quite clear. They will average your 6 months of income prior to the date you filed BK. They are not going to care about your income last year, the year before etc. It is simply, the prior 6 months of your income earned before your filing date.

[SinkingFast]

What State do you live in and how many people in your family?? If we know that, we can begin to help provide you with some information.

[Lexy1969]

Sorry could have been more clear.
I started a commission only sales job in September of 06. Made guarantee of 6k each month. Ended November. December pay was only $1200 and January is only $1600 and February will only be $1750. Since I made so much more in previous years would they throw that in? If not its probably better to wait a few months if possible to file to factor the lower income and have a chance at a 7. I live in Arizona with no kids.

[Frank]

If the guaranteed income was 6k how come you got less than that? You should sue them for breech of contract.

[SinkingFast]

If the guaranteed income was 6k how come you got less than that? You should sue them for breech of contract.

It's not uncommon in Sales to be paid the way Lexy is describing. The employer gives you, as a new employee a base amount for a set period of time. Few months. Gives you an opportunity to establish your client base. Learn your territory.

There's also "Draw Against Commission". That's where you'll be paid a minimum amount every month regardless of how little you sell that month. Then when your commissions are substantial enough, the company takes back the "Draw" or the $$$'s paid that you did not earn.

Commission Sales jobs can really be structured many different ways.

Lexy,.............

All the Court will look at, in relation to your BK is the latest 6 months of income. You may have to explain why you earned more in the past, and not now. Job loss/change. Whatever. But your past earnings level is just that. The past. All Trustees will ask if Filers anticipate an increase in income. But someone in Sales may have more than average explaining to do. Depending on your Trustee, you may be asked about future earnings potential that you'd have to explain in detail.

The Median Income for one person in Arizona is $37,492. So until you're grossing $3K/mo, you really don't have anything to worry about as far as filing Ch 7 goes. If, or when you go over that amount/yr, then you'll have to start factoring in Secured Debts. Mortgage, car payments, etc. And Priority Debts. Alimony, child support payments, past due taxes you owe.