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    Just filed and now we are getting a bonus at work.

    We just filed our bankruptcy this past Wednesday and received notification that our court date would be Jan 10th. Tonight I found out from the other shift that we are receiving a bonus from work. It looks like it'll be about $16,000 for me, gross. Obviously I'll be talking to my attorney in the morning but my wife and I are curious now.

    Thanks everyone.

    #2
    HMMMMM that is a real chunk of change. I don't know of a way to "hide" that windfall as that alone is illegal. Well, if you didn't get it, would it have mattered? If you do, you now become an asset case. Talk about mixed blessings. Seek advice as how you can save it such as 2011 (till April 15) HSA. This lowers your tax bill for this year too. I have no idea as really you must report this windfall. Sorry. 'Hub
    If I knew it all, would I be here?? Hang in there = Retained attorney 8-06, Filed 12-28-07, Discharge 8-13-08, Finally CLOSED 11-3-09, 3-31-10 AP Dismissed, Informed by incompetent lawyer of CLOSED status, October 14, 2010.

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      #3
      Not trying to sound like a know-it-all (because I sure don't!), in a Chapter 7 isn't the bonus his to keep since he already filed prior to knowing about or receiving it? (Kind of like winning the Lottery??)

      Regardless, he certainly needs to disclose the info to his attorney and likely the TT, too. I hope it would not cause a Totality of Circumstances issue.

      Congrats to the OP on a nice bonus! In this economy, that is truly a windfall and a blessing!!
      Last edited by ValleYum; 12-21-2011, 07:54 AM. Reason: Added a new thought!
      ~~ Filed Over Median Income Chapter 7: 12/17/2010 ~~ 341 Held: 1/12/2011 ~~ Discharged: 03/16/2011 ~~
      Not an attorney - just an opinionated woman.

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        #4
        Indeed it is a blessing - but VY I think is right - it was UNFORESEEN and a ONE TIME (hopefully not) but for now a ONE TIME event!! and happened AFTER filing...I think Des could confirm this too :-) Tell atty and see what he/she has to say!

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          #5
          It is a one time thing. My company was sold and they are paying the employees part of the profit from the sale.

          Just talked to my attorney's secretary, she's not in today and was told I could either give it up or not go to court and refile in 6 months or so.

          Comment


            #6
            Blake that's odd...UNLESS she thinks that it was EARNED prior to the BK and cannot be exempted...I think the atty and you need to have a detailed conversation and not the secy (of course as you said atty is not in) because I think you can make an argument that this wasn't EARNED until it was paid out OR at the earlier announced to ee's - so since the announcement was done BEFORE you filed, in my humble opinion it could be argued this wasn't EARNED by the company DECIDED to pay it out at such and such time...

            There is a splendid chap on the board here (Despritreya) who is an atty - who has saved my sanity (or what there is of it!) on countless occasions...when he gets off work I'm sure he'll respond to this!

            BUT if worse come to worse, are you guys ok waiting six months??

            Comment


              #7
              What about all that business of bk being a snapshot of the day you filed? I'd think you might possibly be ok, if you can prove it wasn't "premeditated".
              What a kick in the pants to have to give it up. Ain't life funny sometimes?

              Keep On Smilin'

              Comment


                #8
                keepsmiling, I think from an employee's point of view this isn't pre-mediated...and certainly the announcement - the public announcement to ee's may be the key- if it doesn't mention any dates, then that is when it happened, AFTER the bk was filed.

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                  #9
                  I really don't know if we can wait 6 months. It got to the point we just shut our phones off because we were getting so many calls. We will probably net $10k after taxes and everything. Not enough to stop us from needing to file, just enough to really give us a leg up coming out of this ordeal.

                  What a problem to have huh?

                  Comment


                    #10
                    indeed Blake! Is there anything official "on paper" from the employer that has any dates? If not, I'd argue that this happened AFTER you filed, was not EARNED by you - it is NOT wages, rather than profit sharing because the company felt "nice," etc.

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                      #11
                      I don't know, we work a swing shift style schedule. I won't find out until tonight. There was no prior discussion of any of this, which is suprising because even changes in upper management get leaked out to the plant floor before they happen, lol. Hr should be at the meeting tonight maybe I can get something that says.... something.

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                        #12
                        Originally posted by Blake View Post
                        I don't know, we work a swing shift style schedule. I won't find out until tonight. There was no prior discussion of any of this, which is suprising because even changes in upper management get leaked out to the plant floor before they happen, lol. Hr should be at the meeting tonight maybe I can get something that says.... something.
                        Right - if they give you something in writing with a date that's AFTER your filing, I'd make sure to give that to the atty as well (i mean give atty whatever you get)...I'm not sure if anyone has any "right" to delve into the internal board/management minutes discussions, etc...

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                          #13
                          Bonuses are a funny thing in a bk. If they are unexpected or dependant upon the success of your employer, you cannot possibly figure them into your DMI. We have a "gain sharing" plan where I work and is based soley on the quarterly earnings of the company. Anywhere from $50 - $1000 per quarter has been paid out. At the point of filing the yearly gain sharing bonus was calculated in our DMI for that year because it was reported on my W-2's for the previous years. Not really enough to make a noticable difference in our plan payments.

                          Bonused are taxed as unearned income and if you grossed $16k your will probably clear around 60% of that. Still a problem to be figured out by your attorney and TT. Hope things work out in your favor. That would be a good kick off for your fresh start.
                          Filed July 2009. Discharged 08/08/2014. Awaiting closing. We made it !!!! Woo-hoo!

                          Comment


                            #14
                            I don't know the answer to the issue of how the bonus will be impact you in a Chapter 7, but there are some things you might be able to do to lessen the blow. If you determine that the bonus will otherwise result in an asset case, to the extent you can control the payment, limit the amount of cash that you might receive. Make sure you have the appropriate level of Federal and State income taxes withheld. If you participate in an employer sponsored HSA plan, maximixe your contribution. If you participate in a 401 (k) plan, put as much of the bonus in the plan as you can. All of these steps will minimize the actual cash you receive and possibly the amount of assets will still be less than the amount that would convert you to an asset case.

                            Check this all out with your attorney before you take the last two steps to make sure these actions aren't improper.

                            Even if you have to put some of the funds in the 401(k) and take them out in the form of a loan or a distribution later, this would be less costly than giving it away to your creditors.

                            Comment

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