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    BP Oil Spill Check

    I received an emergency BP Claim check about 6 mths ago and spent it down, per my attorney on necessary living expenses. Planning to file non consumer ch 7 middle of this yr. I am still unemployed and should be able to file for a sizeble final BP check. How is this handled in BK? It's for lost income (not profit). Should I wait to apply for it till after BK and use it as my "fresh start"? .

    #2
    If it is for lost income up to your date of filing I believe you have to list it as money owed to you and therefore an asset. It maybe tough, however, to determine what portion is from what time period. I know you also have to report even after filing if you receive money that was due to you before your filing date. Your attorney should have the full answer so definitely tell him or her that you expect this money. The attorney will know how best to proceed.
    A fresh start is a beautiful thing. And I'm not an attorney, just opinionated!

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      #3
      You really should ask your attorney. My guess would be that you would lose that since you were able to apply for it before filing.

      Comment


        #4
        i agree with helpme...justbeach....even tho this check may cover a capitol loss...which in most cases wouldn't be considered "income"....while during a bk if the amount was large enough, you may not have to file????
        8/4/2008 MAKE SURE AND VISIT Tobee's Blogs! http://www.bkforum.com/blog.php?32727-tobee43 and all are welcome to bk forum's Florida State Questions and Answers on BK http://www.bkforum.com/group.php?groupid=9

        Comment


          #5
          This claim for personal income is a drop in the bucket compared to the $1 mil in bk write off due to large landlord corp trying to get me to pay rent due for 10yr lease that I had to break, plus numberous other loans. If I did recieve it, how long could i realistically take to spend it down? Lost 8 yr biz, and income due to BP BS.

          Comment


            #6
            One of the questions asked of you prior to filing is if you are aware of any potential funds from a lawsuit, back pay, claims for owed money from your employer, a pending inheritance, etc., etc. Since you have knowledge of this forthcoming check and there is evidence that you have knowledge of it, you need to speak with a BK attorney. Otherwise you could face fraud issues.
            _________________________________________
            Filed 5 Year Chapter 13: April 2002
            Early Buy-Out: April 2006
            Discharge: August 2006

            "A credit card is a snake in your pocket"

            Comment


              #7
              flamingo- totally understand that. So, would you recommend taking the final claim and spending it down, PRIOR to BK? I haven't asked my attorney yet for fear of being judged...he's very conservative. Obviously I would let him know my plans- but I like to know my options. I have been on unemployed for 6 mths (unemployment for 2mths) and BP at least owes me that income back, to live on till I can find other employement. I just can't see giving it up- when it's something I should've been living on before.

              Comment


                #8
                justbeach03:

                I have no advice, but want you to know I HEAR YA! I am in a similar predicament with a personal injury settlement. When I told the attorney I did the consult with about it, they said get it & spend it down. When I said, but I need it to live on after BK, and that I lost wages due to this injury, and that this money is in essence 'what I am out'...and that it seems i should be able to hang on to it..they said "yeah, but since you used credit cards to survive while you were waiting this settlement, even tough you used them because you had no income, in theory the settlement should go back to the CC companies that helped you survive while you had no money." I see that point..but MAN, it is a hard one to swallow. Yep, BP is 'paying you what you lost back then..but back then you used CC (I assume) to survive the lean periods. So...they want 'their' money back. I get it (now) that the CC companies are 'loaning' us money and ANYTHING and EVERYTHING we have or get in the future 'should' belong to them until they are paid off. Doesn't make it any easier to cope with though. And it seems there are ways people find to minimize what they have to give up. I think some do it better than others. I hope it works out for you. It is sure painful to have to get down to being truly penniless & asset-less!! Seem if we have nothing in material items & nothing in money...there is no hope. But at least there is a CHANCE at a fresh start, in theory at least :-)

                My gut, which is almost worthless in of itself..just purely from what I have read here & the advice given me so far..would be accept the money, live off it as long & possible & then file BK. Not accepting it does not change things, from what I can find out. The money is still OWED to you, therefor it is as good as cash in the bank from a BK standpoint. Again, that is my insight purely from what I have garnered here. I think the one difference may be if you can't find a way to exempt it, whether it be a check owing to you or a check you cashed and now have in the bank...then if you have at least accepted settlement and started using the money (wisely...research the heck out of what you CAN & can NOT do with it) you, in theory, have at least been able to do a little something with it. I think leaving it as 'money owed' no matter the reason, would just mean (I THINK) that the FULL amount of it goes to the BK estate. Again, I am not sure...just think this is how it seems from what I have read here.

                Good luck to you...
                JJ
                Last edited by JJCA; 03-16-2011, 09:54 PM.

                Comment


                  #9
                  Depending on the amount you receive, you must remember that your income and financial records will be reviewed for at least six months prior to the time you file. So if you receive this money, and it is a considerable sum, you will have to wait at least six months to file after the money is gone. And you will still be in the same position you are now - the above poster is correct in several ways as the money you are receiving would be viewed as money to pay your bills and live on. Instead of playing guessing games with all this and since you don't know how much will be coming in or exactly what you may be entitled to receive, you should fully discuss this with a BK attorney since it seems you are insolvent at the moment but will have enough funds coming in to live off for a while and know those funds are coming. Playing games gets you into trouble or something can pop up later to bite you in the rear. Get good, sound legal advice on this one for the state in which you reside.
                  _________________________________________
                  Filed 5 Year Chapter 13: April 2002
                  Early Buy-Out: April 2006
                  Discharge: August 2006

                  "A credit card is a snake in your pocket"

                  Comment


                    #10
                    can't you defer the check from bp?? i mean request an later payout date?? now that's a thought..

                    Comment


                      #11
                      Flamingo- I understand they will look back 6mths at bank statments...as a non-consumer BK are you recommending 6mths AFTER I've spent all the money? If there was a few thousand that was in the bank during that 6 mths and spent down to zero for obvious living expenses...would that still raise a red flag?
                      Thanks everyone...REALLY good advice. I think the "money owed" aspect is clearly the "sticking point" and something I would like to avoid too. I just want this all to be over!
                      I have 2 pending default judgements. Realistically- how long can this process go on?

                      Comment


                        #12
                        Originally posted by justbeach03 View Post
                        Flamingo- I understand they will look back 6mths at bank statments...as a non-consumer BK are you recommending 6mths AFTER I've spent all the money? If there was a few thousand that was in the bank during that 6 mths and spent down to zero for obvious living expenses...would that still raise a red flag?
                        Thanks everyone...REALLY good advice. I think the "money owed" aspect is clearly the "sticking point" and something I would like to avoid too. I just want this all to be over!
                        I have 2 pending default judgements. Realistically- how long can this process go on?
                        OK - I missed the "non-consumer" part of your posting...you need to have your situation fully evaluated by a good bankruptcy attorney as it appears to be a bit complicated and you are assuming you will be able to file as you state. Also, you have knowledge prior to filing of forthcoming lost income/funds - you just haven't filed for those funds yet - and are hoping to circumvent involving those funds in the bankruptcy and how to do it. This forum does not condone fraud and, as you indicate above, that is the reason you are hesitate to discuss with your attorney (don't want to be judged). When you appear at your bankruptcy hearing, you are under oath when asked certain questions about your financial matters and you are asked if you are involved in any lawsuits or are aware of any inheritances or other funds that will be coming your way. When your situation is complicated and also involves business matters, it is best not to guess about things but get good sound legal advice, especially in your situation as to what you are describing.

                        Best of luck to you...
                        _________________________________________
                        Filed 5 Year Chapter 13: April 2002
                        Early Buy-Out: April 2006
                        Discharge: August 2006

                        "A credit card is a snake in your pocket"

                        Comment


                          #13
                          Originally posted by SacMan View Post
                          can't you defer the check from bp?? i mean request an later payout date?? now that's a thought..
                          Doesn't matter, it's still money owed and an asset of the BK estate.

                          Comment


                            #14
                            Flamigo~ I'm don't expect anyone here to condone fraud (not what I'[m trying to do). But I understand that when people are owed money from the irs- its advised to take it and spend it down to live off of. I can't seem to get a straight answer from my attorney...he tells me to live off it in one sentance, then contradicts in the next sentance. Could someone could please decifer/weigh in on the the following email he sent?

                            "If you make a final claim, you can live off the funds if you need to. If you file for Bankruptcy and have not filed the final claim, the Trustee will file it and use the proceeds to pay your creditors. You can do what is necessary in order to support yourself and live, you cannot dispose of assets in contemplation of a bankruptcy which would deny you a discharge."

                            Comment


                              #15
                              The way I'm reading it, he's saying you could file the claim now, get the money, and then spend it on normal living expenses...all before filing a bankruptcy. He then seems to suggest it would be unwise to try to convert it or hide it. Just spend it down on normal stuff and for the moment just assume that the assistance helps you avoid BK. If, after spending the money, you realize that you still have to do a BK, then so be it.
                              OK - from now on it's not a "Bankruptcy." It's a "Weight Loss Program." I'm in. Sign me up.

                              Comment

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