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How Is My ‘Household Income’ Calculated in Bankruptcy?

On Behalf of | Aug 29, 2014 | Bankruptcy Basics

When you decide to file a personal bankruptcy, it is important to understand that you will make a full financial disclosure to the court. In other words, you should be prepared to discuss your assets, debts, income and expenditures openly and thoroughly with us. When it comes to disclosing your “household income” to the bankruptcy court, you must include more than just your salary.

We will help you understand what sources of income must be considered for bankruptcy purposes, but below are a few examples:

  • Gross wages. Simply stated, you must include everything you and your spouse earn from your employer. This includes your salary, overtime pay, tips, bonuses and commissions. With this in mind, we can review the timing of when you expect to receive a significant bonus or other payment because it could affect your ability to file a Chapter 7 case.
  • Income from a business. Any income from a business that you own (fully or partially), must be disclosed. This includes money received from rental property, farming, an online business, or other similar ventures. The income from a business that is considered for your bankruptcy is the amount left after deductions are made for your operation expenses.
  • Investments. Income such as dividends, royalties or interest that you receive from investments in stocks or mineral rights must be included in your disclosures.
  • Pension and retirement income.
  • Child support. Payments for child support or alimony that you receive on a regular basis should be disclosed.
  • Unemployment benefits. You must disclose any unemployment payments you received within the six months prior to your filing.
  • Income from rents and other real property.

There may be other sources of income that you receive that should be included in calculating your household income. Let us review your individual circumstances and help you determine whether you qualify to file a Chapter 7 or Chapter 13 bankruptcy.

If you are interested in learning how filing a bankruptcy case can benefit you, contact Levitt & Slafkes, P.C., at 973-323-2953. You can also reach us by filling out our online form. We represent debtors in Chapter 7, Chapter 13 and Chapter 11 filings. Let us help you get the fresh financial start you need today.