Income between filing and the 60 day club

[justbroke]

After we filed and before our 341, I applied for Social Security. Stupid, now I know, but too late. The Social Security I get is no problem because it just replaces the suppliment I will loose almost evenly. The problem is my kids each get 50% of my SS now too. At the 341, we were asked to amend our Schedule I to reflect what has changed. Can they dismiss our Chapter 7 because of the SS our kids will get? The kids will only collect for about 18-24 months.

I don't know if they'll dismiss, but they certainly want to see how it impacts your Schedule J "disposable income". You have an attorney, right? Since you probably included the kid's expenses on your Schedule J, the impact of them receiving offsetting SSI... may cause some issues, but I'm no expert on this particular scenario.

Were you under the median, and/or have a very negative disposable monthly income?

[60dayPanic]

Yes, we have an attorney and yes, we were under the Median. The Trustee only asked us to amend our Schedule I, which we've done. I guess now we wait. Thanks.

[ApresMoi]

This is inaccurate in a Chapter 7 context. The only "windfalls" that are included in your bankruptcy estate, after filing, are inheritances, death benefits paid to you as a beneficiary, and property as part of marital dissolution, that are received or you are entitled to receive within 180 days of filing.

In some very remote instances -- because winning the lottery is just phenomenal -- the U.S Trustee (UST), not the panel Trustee, may claim that the circumstances have changed and file a dismissal for "totality of circumstances". However, the Trustee is not entitled to that money as property of the estate. This is a very very important distinction, because that would mean that the Trustee would be entitled to keep the lottery earnings, and they can not. However, they could seek to dismiss under a "totality of circumstances".

Please note, that even getting a high paying job just days after filing, can get you a dismissal for "totality of circumstances". (There is plenty of caselaw on the high paying job just after filing and before the 341 Meeting.)

What specifically is property of the "estate" is specified in the Bankruptcy Code (11 USC 541), and virtually all property that you receive after filing, is yours and not subject to the Trustee's liquidation powers.

I will end with this. The UST usually won't do anything about new income after filing the petition. However, if it's significant, s/he is within their power to ask for a dismissal for "totality of circumstances". Some USTs don't really care, and others are specifically looking for people who time their bankruptcy to take advantage of loss of income, or a new job starting.

I would just say... proceed cautiously.

I took a second look at filing early for social security, and now think that I might consider it. I could really use the extra income.

If I did file for SS before filing for Ch. 7, would I have to include that Social Secuirty income in my Schedule I calculations? I know it is left off the means test (and wouldn't create a problem there even it if were included). I am less clear on whether it needs to put on Schedule I, or whether that income would be included in the 'totality of circumstances' by the Trustee.

Would it be any 'safer' to file for social security AFTER the 341?

[ApresMoi]

I took a second look at filing early for social security, and now think that I might consider it. I could really use the extra income.

If I did file for SS before filing for Ch. 7, would I have to include that Social Secuirty income in my Schedule I calculations? I know it is left off the means test (and wouldn't create a problem there even it if were included). I am less clear on whether it needs to put on Schedule I, or whether that income would be included in the 'totality of circumstances' by the Trustee.

Would it be any 'safer' to file for social security AFTER the 341?

Also, my 'totality of circumstances' includes (if I file for Ch. 7 next month) a projected loss of unemployment benefits in a few short months during a grim job market. Social security and part-time work may be the only option available to me (this would be after the 341, but before discharge).

[ApresMoi]

Also, my 'totality of circumstances' includes (if I file for Ch. 7 next month) a projected loss of unemployment benefits in a few short months during a grim job market. Social security and part-time work may be the only option available to me (this would be after the 341, but before discharge).

Please disregard these posts. My apologies, I just read back further and see my question has been answered. Yes, Social Security income would be considered in disposable income calculations based on Schedules I and J.