Some Receipts Not Counted as Income in Chapter 7 or Chapter 13 Bankruptcy Cases

A main issue in any Chapter 7 or Chapter 13 Bankruptcy case is the calculation of what is known as “current monthly income”.    This issue is the often the most important one in determining whether a debtor qualifies for a chapter 7 bankruptcy or is required to pay their creditors in a chapter 13 bankruptcy.

In some cases, even though a debtor has received money, it is not counted as “income” for purposes of determining qualification for a chapter 7 bankruptcy case.    Funds received from the following are not included:

(1) money received from the sale of property, such as stocks, bonds, a house, or a car (unless the person is engaged in the business of selling such property);

(2) withdrawals of bank deposits;

(3) money borrowed;

(4) tax refunds;

(5) gifts; and

(6) lump-sum inheritances of insurance payments.

See U.S. Census at

Thus it is important to review these issues with an experienced bankruptcy attorney in determining qualification for a chapter 7 or chapter 13 bankruptcy case.


Contact an Edison Bankruptcy Attorney from Gillman, Bruton & Capone Today

Facing overwhelming debt is a daunting prospect. Calls from creditors and threats of repossession or foreclosure can take a toll on families. It may seem impossible to dig out from a hole and regain financial flexibility and freedom. Thankfully, an Edison bankruptcy lawyer wants to help you. Unlike many other law firms that suggest filing for bankruptcy as the sole chance to escape from under debt, we recognize that many alternatives may be available that bring a similar outcome. Even when bankruptcy is the best option, we provide you with all of the information you need to protect your interests. Give Gillman, Bruton & Capone a call today to schedule an appointment and a free case evaluation.

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