Can they touch money that family gives to support you?

[justbroke]

She did not inform me nor has my brother informed me of how much or when . . is there any way around this? Will the bankruptcy trustee take this money?

You are supposed to disclose this, and it will probably show on your taxes anyhow. If you filed with an attorney, ask for some advice on how to proceed. If the amount is less than 10% of your income, then you'll probably be okay. However, if it's significant, this is a change in income and usually needs to be reported to the Trustee. The Trustee will then determine how much, if any, they want from the payments.

I can't tell you if it passes any threshold that your Trustee may or may not have. That's the only reason I ask you to seek advice from your attorney.

[SDVikings]

Chapter 13

OK so here is question on family money being taxable. My husband and I are in our third year of a five-year plan for Chapter 13 and I was just informed by my mother that my brother (who has taken over the family farm) will be starting to distribute rent payments to myself and my two sisters!!! My family does not know about our bankruptcy and we would like to keep it this way. I am assuming this is considered 'income' even though it is sort of my inheritance etc. She did not inform me nor has my brother informed me of how much or when . . is there any way around this? Will the bankruptcy trustee take this money?

[justbroke]

What if the relatives would simply pay your bills for you and not give you money to pay them on your own? Instead of a relative giving you the money to pay a phone bill, why don't they just add it on the on-line bill pay and pay it or write a check themselves? That's what I have done so far. I will pay part of the electric bill directly but will never give the person they money to pay it on my behalf that when I am ensured that the bill will be paid.

My post and that dialogue was hypothetical. Trustees will ask where your money comes from and who pays your expenses, if you're unemployed. The distinction is probably how you word it, since it's paid for your benefit, but never directly received by you personally.

[debtmonster]

It's going to go down like this (remember, this is just theoretical, but I'm confident that this sort of questioning will occur):

Trustee: you list no income, where do you get your support?
Debtor: Well, my family pays my bills.
Trustee: how do they do that?
Debtor: Well, my brother gives me money by depositing money into another family member's account so that they can pay my bills.
Trustee: Interesting. How much money is in that account?
Debtor: $XXX
Trustee: Why did you not list that as income?
Debtor: Because it never touches my hands... and...
Trustee (interrupting): But it's paid to your benefit, right?
Debtor: Yes.
Trustee: I'm going to continue this 341 Meeting in order to dig further into this matter.

Of course, this may turn into nothing and the Trustee just says "okay" and doesn't want to inquire any further. I just pasted a scenario in which you could be dragged into a line of questioning that may raise questions, based on other facts included in your schedules.

In the end, I don't think it will go this way of inquiry, but you should have a really good (truthful) story on the account and how you are surviving. You never mentioned who you live with?

I guess my family not helping me at all would be a total blessing in disguise. I was always mad at friends and family not helping me out financially, but if that scenario was to happen at my 341, I would have not been a happy camper.

What if the relatives would simply pay your bills for you and not give you money to pay them on your own? Instead of a relative giving you the money to pay a phone bill, why don't they just add it on the on-line bill pay and pay it or write a check themselves? That's what I have done so far. I will pay part of the electric bill directly but will never give the person they money to pay it on my behalf that when I am ensured that the bill will be paid.

That way if you say you have no income, you really mean it. Just because other people are paying for stuff on your behalf does not constitute an income. An income is actual monies going into your account.

[debtmonster]

The definition of "income" varies depending on where you hear of it...

Definitions of income on the Web:

"Money one earns by working or capitalising off other people's work"
en.wiktionary.org/wiki/income

"Gross earned income, less business expenses, but before any other deductions. Income includes salaries, wages, fees, commissions, bonuses, business profits, or other payments for personal services. It does not include unearned income from savings, investments, or real property."

https://www.doctordisability.com/glossary/

"The amount of money received for labor, for services, from the sale of goods or property, or from investments."

https://www.numbernut.com/glossary/i.shtml

"means any money received from any source, including but not limited to remuneration for labor, products or services; money received from governmental assistance programs; tax refunds; prize winnings; pensions; investments; and money received from any other source."
spd.iowa.gov/staticpages/index.php

"Money earned through employment and investments."

https://www.wdfi.org/ymm/kids/glossary/default.asp

"Excess of revenues over expenses."

https://www.vba.va.gov/ro/central/stpau/Veterans/Mortgage%20Definitions.html

"Generally defined, is the money that is received as a result of the normal business activities of an individual or a business."

https://www.njmandco.com.au/definitions.html

[OhioFiler]

I don't understand why the OP is even considering filing bankruptcy if he has no income and no assets.

Justbroke is dead on. The trustee is likely to ask where the money has been coming from to pay his bills. His schedules become suspect at that point.

[sirius]

In the end, I don't think it will go this way of inquiry, but you should have a really good (truthful) story on the account and how you are surviving. You never mentioned who you live with?

I live with a parent.

Also, I guess I'm wondering what to do if I get to the point that I stop paying my cards. I'll still be getting that money. It's only 600 a month. I guess I would just cash the checks at that point and never put them in any account. If I do that, I'd like to be able to save the money so I can have something to live off of as my future is uncertain and I may have to move out, etc...

Would this money be easy to keep or am I going to have to say I have it? How would they ever know what cash you have?

If that's going to be a problem I guess if I stop making payments and plan for a BK I could have my brother stop helping me until the BK is over? I wouldn't want to waste his money.

[CCsAreEvil]

Well, I'm in a similar situation. I've asked my attorney twice about this, but he just said it's not an issue. He kept saying it's just a gift.

Basically, I just mail my parents my mortgage payment, and they send the check directly to the mortgage company. The money never gets into my "hands" (no bank deposit into my account).

I really hope my attorney knows what he is doing.

[adviceplease]

I wish I still had all the money. It is probably about $600 in gifts over the last 6 months for holidays and birthdays, and maybe $2000 from my MIL and $800 from my mom (just sent to catch up mortgage). We have used most of this to pay the credit card payments up until this month. A lot of the time it is gas money from my MIL because she does not drive and I take her a lot of places so about $100 a month was for her transportation and money to buy my daughter things.

I do not plan to pay any of the money back it was a gift to get us caught up enough to even pay a lawyer to do the BK. Both parents are not going to give us money after this month because they do not have any extra.

[justbroke]

Hmmm....we have recieved some money from family over the last 6 months. We also have recieved money for birthdays and other holidays through checks. Should I make a list of which is paid for us to use as an income and the ones that were gifts for holidays?

Birthday and holiday money is insignificant. You also spent it, so it's of no concern, really, unless you paid it back to them. The Trustee is looking for actual money in a bank somewhere (that is not exempt) or that you paid insiders (family) or paid a creditor as a preferred creditor.

[adviceplease]

Hmmm....we have recieved some money from family over the last 6 months. We also have recieved money for birthdays and other holidays through checks. Should I make a list of which is paid for us to use as an income and the ones that were gifts for holidays?

[2manybills]

JB I agree. As my attorney always told me: "Prepare for the worst and hope for the best"!
It paid off in the end.

[justbroke]

How is his brother's money in his parent's checking account his property? I don't get it.

It's going to go down like this (remember, this is just theoretical, but I'm confident that this sort of questioning will occur):

Trustee: you list no income, where do you get your support?
Debtor: Well, my family pays my bills.
Trustee: how do they do that?
Debtor: Well, my brother gives me money by depositing money into another family member's account so that they can pay my bills.
Trustee: Interesting. How much money is in that account?
Debtor: $XXX
Trustee: Why did you not list that as income?
Debtor: Because it never touches my hands... and...
Trustee (interrupting): But it's paid to your benefit, right?
Debtor: Yes.
Trustee: I'm going to continue this 341 Meeting in order to dig further into this matter.

Of course, this may turn into nothing and the Trustee just says "okay" and doesn't want to inquire any further. I just pasted a scenario in which you could be dragged into a line of questioning that may raise questions, based on other facts included in your schedules.

In the end, I don't think it will go this way of inquiry, but you should have a really good (truthful) story on the account and how you are surviving. You never mentioned who you live with?

[AngelinaCatHub]

How is his brother's money in his parent's checking account his property? I don't get it.

Because you have to have some viable way of support. Just to be safe, keep the account low as if you get an AH who may consider you hiding funds. Just not to have that bother over your head. That is all. In all, I believe everyone here agrees, you have not real problem so have a cold one and relax. 'Hub

[bkmaggster]

If it's not in your name, then it's not your money. However, the Trustee will ask, at your 341 Meeting, if anyone else is holding on to property for you. I would err on the side of caution and make sure that account has very little money in it on the day of your 341 Meeting. This is actually a standard practice anyhow.

How is his brother's money in his parent's checking account his property? I don't get it.