Experience Visit http://www.bklaw.com for more information on bankruptcy in general and Mark J. Markus in particular. Many questions are answered on the web page (hint, hint). The Markus webpage also contains more information on
Education/Credentials J.D., University of Arizona 1990. B.A. Economics, California State University, Northridge 1986. For more details please click here
Question After completing a sample Means Test, it appears that we qualify for Chapter 7 with our normal income and expenses. However, during the last six months, we have sold some of our personal property to pay creditors and to make ends meet. These were items like you would sell in a garage sale, etc. (animal cages, dryer) The funds for this were deposited in our checking account. My first question is this considered INCOME for the Means Test? Second, will the Trustee go through our bank account deposits and question each and every transaction over the last 6 months? I have a few deposits that were from friends paying me back for something I bought for them - it wasn't income. I am hoping they will accept this explanation if necessary?
Answer Technically the capital gains from the sales of those items would be included in the means test, so you'd need to establish the cost basis for each item and subtract that from the sales price to determine the gain, which would be the income.
The Trustee can look through the bank account statements, so you should be able to identify the source of each deposit. Friends repaying you is not income.
