The Nightmare Begins

[screentest]

Well after 6 months of preparation and 90 days of overtime loss to get my income numbers down enough to file within the 6-month look-back period, the U.S trustee has notified my attorneys they intend to audit our case. We are over the median; however, have negative $500-$700 DMI.

This is the nightmare scenario that had kept me from filing last year and has kept me up many, many nights. We are 7 days away from our 341 and the nightmare begins. They now want all pay stubs from July and a w-2 from 2009 (they have that) July is a 3-paycheck month so all my numbers will be off now. In addition, because I was told to relax everything looked water tight, I began taking overtime again in July because I am so desperate for money. We have to eat! If they use July shouldn't they now eliminate January??

I explained this to my attorneys and they seem unfazed and insist they have dealt with this before and have never lost a motion to convert or dismiss.(could I be the first?)

Now I regret working any overtime and feel with the 3 checks in July there is going to be problems getting a ch 7 discharge. My attorneys disagree of course and continue to be confident in my outcome. I have NO MONEY to fund a 13 and no assets to protect period! They believe I was randomly selected for an audit, stating 1 in every 250 are selected for this audit and it wasn't based on my petition.

I thought BK was a snap-shot not a movie.....now we are rolling along with another month to look at.(sounds like a movie to me)

We just went over the petition 2 days ago to prepare for our 341 and reaffirmations and EVERYTHING seemed fine. Now the call and here we go.

Sorry I am venting...my middle name must be random....now back to sleepless nights.

Keep everyone posted. (Central District of California Riverside Court)

[Meatstick]

Did you consult your attorney before going back and working the OT ? I would almost bet any attorney would advise you to wait until your 341 was finished and/or you are discharged.

That said you probably don't have much to worry about if your attorney doesn't seem worried. Besides if the UST asks you to amend your petition that opens the door for you to also include allowable expenses that weren't included in the initial filing.

Hang tight I am sure you will be fine.

[screentest]

Thanks, I was actually mandatoried to work the overtime. Our overtime is random and seasonal. (summer mostly)

I knew the summer months would pose a problem with me getting caught and forced to cover shifts for those out on injury and long-term assignments. This is very ramdom; however, some summers there is almost no overtime and others...well....its unpredictable. I was able to avoid mandatory OT up to now but now that more and more people are out on assignments it gets hard to avoid.

This is the explanation my attorneys plan to offer the trustee and don't seem to have a problem with it. I hope they are right.

ST

[SMinGA]

The means test is based on a set range of months. But I understand check stubs up to the 341 may be requested. If overtime is not guaranteed, you should be able to truthfully explain that.

[liz417]

I filed in Central District too and was over the median. If the overtime is not a guarantee every month, your attorney should have the chance to explain that to the Trustee. This is probably just a random audit, as long as your attorney doesn't seem too concern and knows his/her stuff, you should be just fine.

Good Luck!

[screentest]

Just left the attorneys office and dropped off the additional info the U.S. trustee requested.

They believe the U.S. trustee is gearing up for a challenge on income/DMI or ? and maybe this is not a full blown audit ....yet. Said we would all find out at the 341 a week from Tuesday. Its going to be a long summer!

Thanks all for your support.

ST

[wsy]

Just left the attorneys office and dropped off the additional info the U.S. trustee requested.

They believe the U.S. trustee is gearing up for a challenge on income/DMI or ? and maybe this is not a full blown audit ....yet. Said we would all find out at the 341 a week from Tuesday. Its going to be a long summer!

Thanks all for your support.

ST

I just finished an audit and if they are only asking for 6 months worth of records sounds like a random audit.
They will inspect all deposits over 500.00 in any accounts you declared.
Regarding income it will be the average of 6 months and if your overtime was included in the deposits it will be counted for the average.
If your income from the audit does not match what your attorney put in your paperwork it could be as simple as an explanation or they will file a "material misstatement" which may require going to court and depending on the misstatement they will act on it. The worst part of it is a chapter 13 conversion. Good luck and wish you well.