Bonus? Do I tell?

[ame8199]

Hello,
Im 10 months into a 3 year chapter 13 plan. I work for a non-for profit and sometimes we get bonuses. They are not guaranteed, but we MAY get one this year, the way they talk. I would know at the end of this month and/or the end of June since the fiscal year ends in June and all the money needs to be used up by then.

Anyway, if I do get a bonus, should I let someone know? or keep it hush hush until the trustee ask for it? I dont want to hide anything, but I could use that money. If I do get one, is there a way I can ask to keep some of it? My dog is having surgery and I could use my wisdom teeth out. Is there a way to file to keep some/all of it?

The trustee asked about the bonus during my confirmation, but I havent got any paperwork saying if I got one, he wants it. Do I wait for that paperwork? or ask my lawyer?

Thanks!
Amy

[lrprn]

Ask your lawyer, Amy. He/she understands your case and your trustee's customs around bonuses during Ch 13 best. Hope you get to keep it!

[Universal]

Absolutely let your attorney know. It may/may not be significant enough to have to report. Your attorney knows your case best and will address the issue with you. We are all rooting for you to get to keep it.

[Hos75]

What have you said that the trustee asking about it already? I'd say don't say a word! File AFTER the bonus is given and claim it as part of your pay. If you report it, you'll be asked about it every year for 5 years, just like your tax return, and you'll be sorry. Look at it this way, that bonus can be used wisely for things you CAN NOT use credit for anymore, and you will NOT be able to even get credit for if you need it! That in and of itself should be a warning. Any additional funds should be kept in reserve. Let the dastardly beast of the 13 play out to your advantage and keep whatever additional monies you can, the trustee will only take the extra money out to pay towards your unsecureds, not to mention his fees for distributing your bonus.

[Flamingo]

Yes you report it to your attorney and check with him/her how to handle any future increases. Unless you are advised otherwise, all increases to your income during your Plan years are to be reported to your attorney - remember, you are not in control of your finances during your Plan - your Trustee is from the day you file until the day you are discharged.

Most people during a Chapter 13 need to provide to the Trustee within a certain time period after filing copies of their state and federal tax returns. The Trustee can also at any time during your plan ask for financial information. The key to a successful Chapter 13 is complying, not hiding anything, so make sure you always check with your attorney as to any financial change during your Plan.

[Flamingo]

What have you said that the trustee asking about it already? I'd say don't say a word! File AFTER the bonus is given and claim it as part of your pay. If you report it, you'll be asked about it every year for 5 years, just like your tax return, and you'll be sorry. Look at it this way, that bonus can be used wisely for things you CAN NOT use credit for anymore, and you will NOT be able to even get credit for if you need it! That in and of itself should be a warning. Any additional funds should be kept in reserve. Let the dastardly beast of the 13 play out to your advantage and keep whatever additional monies you can, the trustee will only take the extra money out to pay towards your unsecureds, not to mention his fees for distributing your bonus.

What you are posting is totally incorrect and can get someone in a Chapter 13 in serious trouble. Hiding financial information during a Chapter 13 or hiding a bonus, lottery winnings, inheritances, raises, etc., etc. can cause a dismissal. See my previous posting - your finances are not in your control during your Plan years - they fall under the control of the Trustee.

[Universal]

Again, by all means, do not hide or keep anything from your attorney. Attorneys can deal with what they know, but surprises are not welcome.

[momofthree]

What have you said that the trustee asking about it already? I'd say don't say a word! File AFTER the bonus is given and claim it as part of your pay. If you report it, you'll be asked about it every year for 5 years, just like your tax return, and you'll be sorry. Look at it this way, that bonus can be used wisely for things you CAN NOT use credit for anymore, and you will NOT be able to even get credit for if you need it! That in and of itself should be a warning. Any additional funds should be kept in reserve. Let the dastardly beast of the 13 play out to your advantage and keep whatever additional monies you can, the trustee will only take the extra money out to pay towards your unsecureds, not to mention his fees for distributing your bonus.

She filed 10 months ago...this is no longer an option.

[pepperoncini]

FWIW, I asked my atty at our consult (we haven't filed yet) about random bonuses. DH sometimes gets them quarterly, but sometimes doesn't sell enought to get one. For instance, he got a year end bonus of $2500 for 2009, but didn't get one for 2007 or 2008.

The atty said that our income is low enough that if the trustee asked, he could exempt it.

Not sure if that would apply to your situation but I would sleep a lot better at least running it by my atty.

[ame8199]

Well i did get one. Smaller than last years, but still a significant amount. I called my paralegal and she wasnt sure. She looked at my file and asked around the office (hopefully she asked the lawyers). She said there was nothing in my file that would scream that I wouldnt be able to keep it. She said that the people she asked couldnt find a reason that I couldnt keep it. So its mine. The trustee has not requested it, so its mine all mine.

If I would have claimed my bonus as part of my pay when I filed, my payment would be way more than I could afford at that time. Im living paycheck to paycheck as it is. But I am being smart about the bonus and spending it wisely.

My trustee did NOT ask about my current bonus. He asked about last years at my 341. I said nothing that would make him ask about it. It was just in my paperwork and not included in my income...

Also, my trustee doesnt ask for my tax returns. I do have to turn a copy into my lawyer and my trustee only wants any refund that is over 750 dollars. I get to keep 750 dollars of my tax return.

[Flamingo]

The paralegal was wrong as to not check with your attorney as to your bonus situation...I would suggest you call back and speak directly to your attorney unless your paralegal was giving you direct information/advice from your attorney. For her to ask people in the office and not consult with your attorney is 100% wrong and with all the good advice given to you in this thread as to your situation that should have raised a red flag to you to check directly with your attorney. Heads would roll in our office if a situation such as you described occurred. While a paralegal has an important place in a law office, he/she cannot give legal advice except to convey it directly to you from the attorney. How do I know this? I am one...

Get the answer you need and don't play games with your Chapter 13 if you want to complete it succesfully. If you don't report the bonus, you are risking the dismissal of your Chapter 13.

[ame8199]

Thank you, I just emailed my lawyer to make sure that she talked to him. I hope she wasnt wrong about this. I already spent some of it

[Flamingo]

Thank you, I just emailed my lawyer to make sure that she talked to him. I hope she wasnt wrong about this. I already spent some of it

We all make mistakes and learn the hard way but you need to realize that during a Chapter 13, your financial house is not your own to make decisions...your financial house is under the control of the Trustee and that is difficult for a lot of people to handle/understand. Hope you don't have to pay the money back...best of luck to you!

[Universal]

I hope you get to keep all the bonus. But, as above, always make sure the attorney is aware and kept up to date on your situation and changes.