Around the beginning of the year, my husband, who is an auto enthusiast, developed an alcohol injection system for his car. He made a few extras and put them for sale on an auto enthusiast forum. They all sold, so he made a few more and sold those too. Eventually, he set up a forum for people to discuss installation and experience, and then he started selling the kits on the website. From February through August, his sales were about $38,000. However, a lot of that went right back out the door because he was collecting money, then ordering the materials and sending them out. By my accounting, he had a $5,000 net loss. In August, he decided to quit doing it for several reasons: 1) Answering questions from people was taking up a lot of his time, and leaving him little time for his family. 2) He had an acquaintance develop a controller, but he didn't have the money to buy the rights to the controller, allowing the guy to sell it to anyone. 3) He is leaving on deployment for six months on November 28 and he won't be here to keep in running anyway.
We reported the venture on our BK forms, saying he stopped selling the kits in August. I wasn't aware of this, but a few weeks after DH decided to quit selling the kits, his buddy Chance asked him if he minded if he took a stab at it. Chance had the money to buy the rights to the controller and the time to dedicate to building it as a business. DH thought that was great and spent a few days showing Chance the ropes. Chance started up with the kits again, using the same name DH had used. DH didn't sell him anything because there was nothing to sell. He did send him a few stickers he had made and a few miscellaneous parts he thought Chance could use, but other than that, nothing exchanged hands. Chance simply paid to have the website put back up and started ordering parts to make the kits.
Is that going to be a problem with our Chapter 7 BK case? I was worried that it might somehow be construed as shifting an asset around, but I don't think it could even be classified as an asset. Yes, we could generate income from it, but DH would have to be here. I don't know enough about it to try it on my own.
Any comments or thoughts?
We reported the venture on our BK forms, saying he stopped selling the kits in August. I wasn't aware of this, but a few weeks after DH decided to quit selling the kits, his buddy Chance asked him if he minded if he took a stab at it. Chance had the money to buy the rights to the controller and the time to dedicate to building it as a business. DH thought that was great and spent a few days showing Chance the ropes. Chance started up with the kits again, using the same name DH had used. DH didn't sell him anything because there was nothing to sell. He did send him a few stickers he had made and a few miscellaneous parts he thought Chance could use, but other than that, nothing exchanged hands. Chance simply paid to have the website put back up and started ordering parts to make the kits.
Is that going to be a problem with our Chapter 7 BK case? I was worried that it might somehow be construed as shifting an asset around, but I don't think it could even be classified as an asset. Yes, we could generate income from it, but DH would have to be here. I don't know enough about it to try it on my own.
Any comments or thoughts?
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