Is There An Income Requirement To File Bankruptcy?

This is a question frequently asked. bankruptcy income

There is no amount of income that you can

make which by itself renders you ineligible

for bankruptcy.

For Chapter 7 bankruptcy there are really two

separate income tests, what I call the real numbers, and the so-called means test.


As you may have noticed, telling the truth is not the strong suit of government officials.

A cautionary tale is provided by a, now, former member of the Illinois parole board.

Anyone filing Chapter 7 bankruptcy MUST provide income verification, recent tax returns and pay stubs.

So, I am not sure how this clown, a former prosecutor, no less, got away with this, but he lied about his income in his 2011 bankruptcy, as reported by George Pawlaczyk in the Bellevile News-Democrat:

State salary records show that Monreal, who is an attorney and former Cook County assistant prosecutor, earned $7,900 a month or $94,800 per year, but listed his income in the bankruptcy proceeding as $3,750 per month. Neither Monreal nor his attorney could be reached for comment.

The new documents filed in the bankruptcy in December now list Monreal’s salary in 2011 as $7,908 a month and his wife Nora Monreal’s income as $524 a month. Previously she reported no income

Read more here:
Contrary to the article, the bankruptcy creditors’ meeting, or 341 hearing, is presided over by a trustee randomly selected by the court computer, from the panel of trustees in that court.
It is the duty of the bankruptcy trustee to investigate each case for assets that may be reduced to cash for the benefit of creditors.
Illinois attorney Adam Monreal managed to lie about his assets as well, no surprise.
From the same story:

The new filings also list “financial assets” that do not appear in the original documents from four and a half years ago. These include an IRA account of $102,701, a state retirement system pension of $18,964 and a “1/6th interest” in a family trust account valued at $334,455.

When cash in two checking accounts plus a State of Illinois life insurance policy with a refund value of $92,000 are added to the assets listed above, the couple’s total assets are $555,698, according to the amended filing. This does not include their Chicago home, valued at approximately $350,000 four years ago

Read more here:
I will try to keep up with this one.
The means test looks at your income for the 6 completed months before you file Chapter 7 bankruptcy, and compares that to a family your size in your county.  Even if you are above the median income, you may still be able to file for chapter 7 bankruptcy, depending on your expenses and circumstances.
For example, you may have made good money for those months, but are now laid off with no income.
The court also looks at what I call the real numbers, your actual income and living expenses now and going forward.  If you have a surplus, your chapter 7 bankruptcy case could be dismissed, unless you convert to a chapter 7 bankruptcy.

Wisconsin Persecution


A Free Speech ‘Scheme’

Prosecutors repudiated in court smear Scott Walker and his allies.Updated June 20, 2014 8:16 p.m. ET

So the national press corps has finally decided to pay attention to the John Doe probe into the political allies of Wisconsin Gov. Scott Walker. Having ignored the story when two judges ruled against the prosecutors’ theory of the case, the press now broadcasts that theory as if it were a fact, not a discredited accusation. The episode further underscores the injustice at the heart of this politicized investigation.

The news reports are jumping on snippets of some 266 pages of documents that the Seventh Circuit Court of Appeals released to the public on Thursday. The breathless page-one stories claim that prosecutors believe Mr. Walker and his allies were part of a “criminal scheme” to coordinate their activities and thus violated campaign-finance laws.

The key point to understand is that this isn’t an indictment, and it isn’t even evidence built into a legal case. It is merely a prosecutorial theory floated to justify a secret grand-jury fishing expedition. The documents have been under seal. The Seventh Circuit released them only because they are related to a federal civil-rights lawsuit against the Wisconsin prosecutors that has already resulted in a federal judge stopping the John Doe with a preliminary injunction.

The other crucial point is that the two judges who have looked closely at the evidence have found no violations of law. To the contrary, both judges have ruled that the prosecutors’ theory of illegal campaign coordination is faulty and itself a violation of the defendants’ right to free political speech. The document dump amounts to prosecutors losing in court but then having the press treat the prosecutors’ claims as if they were the gospel truth.

Take the phrase “criminal scheme,” the words used by special prosecutor Francis Schmitz in December 2013 before John Doe Judge Gregory Peterson. The Wisconsin state judge demolished the charge in his ruling a month later in which he quashed the prosecutors’ subpoenas and ordered seized property returned to those under investigation.

The prosecutors failed to show evidence of probable cause that a crime had been committed, Judge Peterson wrote, because the political groups engaged exclusively in issue advocacy, which is protected by the First Amendment. “Before there is coordination, there must be political purposes,” the judge wrote. “Without political purposes, coordination is not a crime.”

As we reported in November, the Doe investigation began in October with kitchen-sink subpoenas and pre-dawn police raids on the homes of targets, and continued with a secret investigation that silenced conservative groups at the beginning of an election cycle. The tactics were so outrageous and legally dubious that one of the targets, Eric O’Keefe of the Wisconsin Club for Growth, filed the federal lawsuit against prosecutors.

In May federal Judge Rudolph Randa issued a rare preliminary injunction based on his judgment that Mr. O’Keefe had a significant likelihood of winning on the merits. “O’Keefe and the Club obviously agree with Governor Walker’s policies, but

coordinated ads in favor of those policies carry no risk of corruption because the Club’s interests are already aligned with Walker and other conservative politicians,” Judge Randa wrote. Prosecutors are appealing the Peterson and Randa rulings.

The Doe’s underlying theory was also ruled improper by a unanimous panel of the Seventh Circuit Court of Appeals in an unrelated case in May. In Wisconsin Right to Life v. Barland, the court held that Wisconsin campaign finance regulations do not cover issue advocacy like that engaged in by the groups targeted by the Doe. State campaign finance regulators, the court wrote, must respect Supreme Court precedents that “ordinary political speech about issues, policy, and public officials must remain unencumbered.”

As it happens, the “coordination” prosecutors have decried in Scott Walker’s case is nearly identical to the “coordination” employed during the 2012 presidential campaign on behalf of President Obama. In February 2012, Mr. Obama’s official campaign committee “blessed” (as the Politico website put it) fundraising for Priorities USA Action, a liberal SuperPac that supported Mr. Obama and other Democratic candidates. The big dollars soon followed.

The disgrace is that all of this has been known for weeks or months, yet the media reports on Friday ignored or buried it. A reader of the New York Times and Milwaukee Journal Sentinel had to read far down the news stories to see any reference to this judicial repudiation. We realize that these liberal publications have been asleep on this story, but you’d think they’d have more respect for First Amendment law.

Meanwhile, the document dump is serving a political purpose that prosecutors have intended from the start—to tarnish Mr. Walker as he seeks re-election. The prosecutors “by their position appear to seek refuge in the Court of Public Opinion, having lost in this Court on the law,” Judge Randa wrote this week in an order on the unsealing of documents in his own court, shortly after the Seventh Circuit made its documents public. Their position in favor of unsealing is “at odds with their duty as prosecutors which is to see that in any John Doe proceeding the rights of the innocent are protected in pursuit of a criminal investigation.”

This is typical of the behavior of Milwaukee District Attorney John Chisholm and Assistant DAs Bruce Landgraf and David Robles from the beginning. The Democrats hired Mr. Schmitz, a nominal Republican, as special prosecutor to put a nonpartisan gloss on an investigation that the DAs realized would be seen for the political prosecution it was.

In a 2013 petition to Judge Barbara Kluka (the John Doe judge before Judge Peterson), the five district attorneys involved in the Doe ask the judge to appoint a special prosecutor for fear that the “partisan political affiliations of the undersigned elected DAs will lead to public allegations of impropriety.” Democratic prosecutors will be painted as conducting a “partisan witch hunt,” they wrote, while Republican prosecutors would be accused of “pulling punches.” The District Attorneys then recommend that Judge Kluka specifically select Mr. Schmitz as the “independent” special prosecutor. This document remains under seal, but we’ve obtained a copy.

In his own affidavit in response to another lawsuit, this one in state court, Mr. Schmitz acknowledges that the real work in the Doe investigation was handled by the prosecutors who appointed him. “While I have assumed the responsibility for the investigatory decisions made in the John Doe proceedings, I myself have not made application for any form of subpoena, subpoena duces tecum or search warrant from the John Doe judge.”

The real “scheme” in Wisconsin is the attempt by prosecutors to criminalize political speech. This has national echoes in the attempt by the IRS to target nonprofit groups that also wanted to participate in politics. The courts sometimes catch up with these dirty tricks, but in the meantime in Wisconsin they can smear candidates and their supporters who have done nothing wrong. Mr. O’Keefe’s civil-rights lawsuit seeks damages from prosecutors in both their personal and professional capacities, and justice will be done if they pay dearly in both

About Kurt OKeefe

kokPICTUREView my profile on Avvo

For a FREE COPY of my DVD on bankruptcy,

click here.

For a FREE COPY of my book, Consumer’s Guide to Defending Foreclosure,

click here.

My mission is to level the playing field between the Goliath creditors and the David consumers.

In order to do that, my office is high tech and lean and mean, headquartered at home. I have access to offices in Detroit, St. Clair Shores, Redford, Wyandotte and Royal Oak, among other places, to meet with clients.

Many ordinary office tasks are outsourced, for example, my big mailings of court notices et cetera are done in the state of Washington.

This makes my office more efficient, and more productive, and allows me to devote time to client needs.

The bankruptcy court I practice in has electronic filing, so all documents are filed online. So, I can file things from anywhere with internet access, any time of day.

We also have wireless in the Judge’s court rooms, and the creditor meeting hearing rooms, so I am online most of the time, and easily reachable by email.

I love the internet and social media, got on Facebook to keep up to date on my kids, but use it for much more now.

I try to post new information on my websites daily, so that clients can keep up with changes in the law and other new developments.

My daughters are away at college, grad school at U of M, and my 18 year old is a freshman at Kentucky.

I worked my way through college and law school, spending summers at the Jefferson Assembly plant and Lear Siegler Automotive division, making truck axle housings.

During the school year, I worked in the dorm cafeteria.

Kids are big U of M fans, especially football and hockey, so it is great fun to watch the games with them.

They did not pick up my interest in hunting and fishing, though Erin loves shooting clay pigeons with a shotgun, and is in the skeet club at Kentucky.

My most important job is being there father, and I love it.

I joined the Sigma Alpha Epsilon fraternity while at U of M, and still see some of the brothers.

Still married after 25 years, to a realtor, so we are really in touch with the economy of Michigan.

I saw the economic crisis coming, with the liar loans and unethical mortgage brokers, and so many of my clients misled and taken advantage of, by careless mortgage companies and banks, all controlled by their greed.

I want to help the victims recover, fight foreclosure, keep their homes, if at all possible.

And I don’t mind sticking it to the big guys.

So, I attend seminars, keep current on the law and new developments, use listservs whose members are the best consumer attorneys in the country.

So, though I am a solo practitioner, I have instantaneous access to hundreds of attorneys and firms doing the same work that I do. We share information, documents, tactics, to better represent our clients.

We are facing the same big creditor companies wherever we practice, and they tend to pull the same stunts.

On politics, I see us and them. Unfortunately, them is virtually all the politicians.

The people, and the political class.

It is inexcusable that the perpetrators of the world economic catastrophe have not been prosecuted for fraud and the other crimes they committed.

Instead, both of current and previous Administrations have done whatever Wall Street asked, instead of letting them fail and starting from scratch.

I do have an of counsel relationship with attorney Mike Barey, who helps me in all areas of my practice.