Expert: Mark J. Markus- California Bankruptcy Attorney - 6/29/2009

Question
If half of my home has legally been leased,and claimed on Schedule E as Renting Space In My Home, and is the primary source of my income for 8 months,can it be excluded in a Chapter 7 Bankruptcy? Since the 'global financial crisis', my part time regular job, has gradually reduced to one regular client. So my rental income is far greater, but not enough to pay my debts. I was handling things fine until the AIG/Banking Industry, Anti=Regulation Scandal, destroyed my part-time business, and empowered the banks to no longer make loans and to commit fraud to increase APRs, and charge invalid miscellaneous fees.

Answer
Not exactly sure what you mean by "excluded".  Any income, including rental income must be included in the means test analysis, as well as in your current monthly income and expense budget.  Of course the amount paid on the mortgage on property and any other expenses related to the rental would be deducted from that income.