Does Unemployment Count As Income For Bankruptcies

Understanding The Bankruptcy Means Test In California

If you are one of the millions of Americans struggling with consumer debt, filing for bankruptcy might be your best option for finding relief. A few different types of consumer bankruptcy are available for individual debtors. The two most common forms of individual, nonbusiness bankruptcy are Chapter 7 and Chapter 13. Determining the best form of bankruptcy for you depends on the type and amount of debt you owe as well as your level of income and other finances. For debtors who do not have a significant source of income, Chapter 7 bankruptcy may be the best option.

In order to qualify for Chapter 7 bankruptcy, a debtor must satisfy what is known as the Means Test. The Means Test evaluates a debtors finances to determine if they should be permitted to rely on the relief afforded by Chapter 7 bankruptcy. In this article, we review the Means Test and what it means for debtors in California. If you are dealing with crippling debt, reach out to a dedicated Chapter 7 bankruptcy attorney at the Ventura offices of Rounds & Sutter to discuss your debt, your finances, and your options for relief.

Talk To An Alabama Bankruptcy Lawyer About Your Loss Of Income

The loss of a job can be painful. When youve been accumulating debt with the assumption that youll be able to pay it back, job loss can feel like a rug has been pulled out from beneath you. However, Alabama bankruptcy lawyer Charles Grainger can evaluate whether your financial situation warrants filing bankruptcy. Your loss of income may make you eligible for Chapter 7 bankruptcy, which gives you a clean slate. There are also some instances in which you may still be able to file for Chapter 13 bankruptcy or continue to make your Chapter 13 monthly payments, even after youve lost your job. We serve clients in the areas surrounding our offices located in Montgomery, Prattville, and Troy, Alabama. Call us at 260-0500 or contact us online to schedule a consultation.

Minnesota Unemployment Overpayment And Bankruptcy

Sometimes people receive more money from unemployment than they are supposed to get. This can happen in any number of ways, many of which are perfectly innocent.

For example:

• You could fill out the unemployment forms wrong, saying that you had more income at your previous job than you thought.
• You could lose your job, apply for unemployment, and start receiving it, but then your previous employer appeals and wins

Unemployment will start paying out the benefits even if the employer appeals the benefits, and will keep paying the benefits until the appeal is resolved.

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Collecting Unemployment And Social Security Disability Benefits Simultaneously

Contrary to what you might think, it is possible to collect Social Security disability insurance and unemployment benefits at the same time. Of course, it is rather difficult to qualify for both of these benefits at the same time because the eligibility criteria are fundamentally at odds. To qualify for unemployment, you must be actively looking for a job. To qualify for a disability claim with SSDI, you must be permanently and totally disabled. Only a small handful of applicants can meet both of these criteria.

If you receive unemployment benefits, the Social Security Administration will take them into account when they examine your SSDI application. It is your responsibility to prove to the SSA that thereâs no conflict between the two benefits.

The same is true for Supplemental Security Income benefits, which are paid to disabled persons. While it is theoretically possible to receive this benefit alongside unemployment benefits, the criteria for the two programs are again largely at odds with each other. Unlike receiving Social Security retirement benefits and SSDI, receiving unemployment benefits may reduce your Supplemental Security Income benefit. Claimants should consult with a qualified disability attorney in either of these cases in order to ensure that they are following the rules and receiving every benefit that they qualify for.

It Can Be Harder To Qualify For Chapter 13

People often file a Chapter 13 because they earn too much to qualify for a Chapter 7 because they want to keep their vehicles, they need to catch up on recent taxes or child support, or because they want to save their home from foreclosure. Since Chapter 13 involves a 3 to a 5-year repayment plan, unemployment can disqualify someone from filing a Chapter 13 because they cant afford the monthly payments.

If you have other sources of income, such as Social Security retirement or disability benefits, unemployment benefits, workers compensation, rental or retirement income, you may have enough income to qualify for a Chapter 13. However, if you are not able to keep up with the monthly payments, your Chapter 13 case can be dismissed.

To explore your bankruptcy options and how they apply to your employment status, contact Albaugh Law Firm today!

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The Difference Between Chapter 7 And Chapter 13 Bankruptcy

In Chapter 7 bankruptcy, a persons non-exempt properties are sold and the profits are used to repay creditors and discharge debts. 96% of all Californians who file for bankruptcy do not have any property that is subject to liquidation because: there is no equity in the property or the property can be protected utilizing exemptions .

In Chapter 13, a person proposes a repayment plan based on their monthly income and expenses. The minimum repayment plan could also be determined if a person has equity in their property. If the plan is approved by the Court, creditors agree to accept these payments for 3 to 5 years and forgive any remaining debts.

If your monthly household income is less than the California state median, you are automatically eligible for Chapter 7. The current median income for a single-person home is $47,798.00.

This limit is raised with each additional member in a household. It also changes annually based on current figures, so check present guidelines before filing your bankruptcy petition.

If your monthly income is above the median, you will need to pass a means test to qualify for Chapter 7. If you do not qualify, you can file for Chapter 13 bankruptcy.

Chapter 13 During Georgia Unemployment

You may file for Chapter 13 bankruptcy if you are unemployed. But if you do not have any employment income, youll need to demonstrate you have some other form of income from a verifiable source that will allow you to afford the payments you schedule in your repayment plan. This could include unemployment benefits, Social Security Disability benefits or retirement benefits. Youll need to show the court you will be able to live up to your obligations in your repayment plan.

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Qualifying For Chapter 13 Bankruptcy When Unemployed

You can file for Chapter 13 bankruptcy if you’re unemployed. Still, you must show you have a verifiable source of income and can afford your plan. Otherwise, the bankruptcy court will dismiss your case.

Where would this income come from if you’re not employed? Sources could include:

• revenue from an income-generating business
• Social Security funds, or
• retirement benefits.

As long as you show that you have enough income from a verifiable source to fund your plan, the bankruptcy court will “confirm” or approve your case.

Will Filing Bankruptcy Hurt My Chances Of Finding A New Job

Probably not. Filing bankruptcy does not automatically hurt your chances of getting hired. In fact, federal, state and local government employers cannot factor your bankruptcy into their decision to hire you.

Private employers, however, are not bound by the same rules as public entities. If you are applying for a job where you would be responsible for handling money , a private employer could pull your credit report as part of their background check, learn about your bankruptcy, and decide not to hire you. Keep in mind that employers must first get your consent to obtain your credit report. When they do, that is an excellent time to have an honest conversation with the prospective employer to let them know you are moving forward after your job loss and filed bankruptcy as part of a larger plan to help you handle your finances responsibly.

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I Recently Made Some Large Purchases On My Credit Card Should I Wait To File Bankruptcy

Probably. Large purchases charged on your credit card within 90 days of filing bankruptcy could be disputed by your credit card company and make it more difficult to get them discharged. In particular, if you purchased luxury items or took a cash advance using your credit card, you may have to repay those debts if you decide to file within 90 days of making the charges.

Historiography And Evaluation Of New Deal Policies

Historians debating the New Deal have generally been divided between progressives who support it, conservatives who oppose it, and some New Left historians who complain it was too favorable to capitalism and did too little for minorities. There is consensus on only a few points, with most commentators favorable toward the CCC and hostile toward the NRA.

Consensus historians of the 1950s, such as Richard Hofstadter, according to Lary May:

elieved that the prosperity and apparent class harmony of the post-World War II era reflected a return to the true Americanism rooted in liberal capitalism and the pursuit of individual opportunity that had made fundamental conflicts over resources a thing of the past. They argued that the New Deal was a conservative movement that built a welfare state, guided by experts, that saved rather than transformed liberal capitalism.

The most common arguments can be summarized as follows:

Harmful

• The New Deal vastly increased the federal debt . However, Keynesians argue that the federal deficit between 1933 and 1939 averaged only 3.7% which was not enough to offset the reduction in private sector spending during the Great Depression

Historical States US

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Receiving Both Unemployment Benefits And Social Security

In most states today, workers can collect unemployment insurance benefits at the same time that they are drawing Social Security. It wasnt always this way, though. In the early 2000s, 20 states plus the District of Columbia had rules stating that if you received both benefits at the same time, then you would have to partially offset your unemployment benefits by as much as 50%. After Illinois repealed this requirement in 2015, Minnesota became the only state left with this provision.

Minnesotaâs offset law currently stipulates that only some residents must reduce their unemployment insurance benefits by up to 50% of their Social Security benefits. The key factors that determine whether this is necessary are the date that the resident began collecting Social Security and the length of time between that date and the date they began collecting unemployment benefits. The Minnesota Department of Revenue website has more information on this.

What If I Didnt Qualify For Unemployment Benefits Because Im Self

The CARES Act created Pandemic Unemployment Assistance to provide emergency unemployment assistance to the self-employed or workers whose benefits have been exhausted. Up to 39 weeks of benefits are available immediately to the self-employed, including independent contractors, freelancers, workers seeking part-time work, and workers with too short a work history to qualify for state unemployment benefits. The benefit is $600 per week, plus 50% of the average income from the previous years highest quarterly income .

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You Will Qualify For Chapter 7 If Your Income Is Below The Median

If your income exceeds the median, you may still qualify for Chapter 7 if your income is below an amount set by law.

While the means test is part of the federal law that governs the bankruptcy courts, each state has the ability to set its own standards for the means test so it can compare figures according to circumstances in that state.

Even if you arent able to qualify immediately for Chapter 7 after you lose your job, you may be able to qualify within a few months.

The limited amount of most unemployment benefits will usually be less than the median, and your financial situation may deteriorate while you are unable to pay your bills.

One exception may be if you have other money, such as payments from rental property or retirement benefits that may be counted as income.

What Can Be Done About An Unemployment Overpayment

As I said earlier, unemployment overpayments are not dischargeable in bankruptcy, and unlike most debts, they are not forgiven if you file a bankruptcy. This is true in both Chapter 7 bankruptcy, and Chapter 13 bankruptcy.

Every so often, however, the Minnesota Department of Employment and Economic Development will decide not to pursue the matter in bankruptcy court, and allow it to be discharged.

This is uncommon, and becoming even more uncommon, so you should not count on it if you file for bankruptcy.

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Bankruptcy Filing: When To Wait After Losing A Job

You may feel panicked after losing a job and watching debts increase. Filing for bankruptcy often needs the right timing to qualify, and an experienced bankruptcy attorney can tell you the best time to file for your situation.

You should consider these questions before you file or speak to an attorney:

• When did I lose my job?
• How long do I predict I will be unemployed?
• Was I making good money that will last me for a few months?
• What am I getting through unemployment compensation and unemployment insurance?
• Does a new job look promising?
• Is my job industry in demand?
• Will I receive Social Security benefits soon?
• Will I be unemployed for months or years due to injury or illness?
• Will medical debt grow while I am unemployed?

Typically, you need to wait to file if you just had a high-earning position because you will fail the Means Test. You might also want to wait to file if you need more medical care. A bankruptcy discharge only works on your debt when you file, so any major medical debt in the future would not be discharged. Wait until your medical procedures or care is complete, so you can see a full view of your medical debt.

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Fraudulently Obtained Unemployment Benefits Are Not Dischargeable In Bankruptcy

State unemployment benefits are paid pursuant to a system that relies on trust. Benefits are paid based on representations made by claimants that they are out of work and that they continue to seek out full-time work. If a claimant finds part-time work, then benefits are reduced accordingly.

A recent opinion from the United States Bankruptcy Court for the Western District of Michigan addresses a Chapter 7 debtors attempt to discharge a debt owed to the State of Michigan for overpaid unemployment benefits, and penalties and interest stemming from the overpayment.

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Will Unemployment Affect Chapter 13 Bankruptcy Repayment Plans

Maybe you have already filed for bankruptcy and set up your repayment plan. Will your unemployment affect your Chapter 13 bankruptcy repayment plan? Generally, the following solutions are possible:

• Continue making your payment as it is currently set up.
• If your unemployment is less, your plan can be modified and possibly reduced if you are willing to give up a car or other item in the plan.
• Ask for a Chapter 13 Hardship discharge if you meet the qualifications.
• You might be able to convert your Chapter 13 bankruptcy to a Chapter 7. Always talk to your attorney before deciding on conversion because it might not have the results you want. For example, you might have to sell non-exempt property to pay some of your remaining debts.

Filing for bankruptcy is a big step that can be challenging even if you are employed. Unemployment can further complicate the process.

Things To Consider When Filing Bankruptcy While Unemployed

While there is no bar to filing Chapter 7 while unemployed you should be thoughtful about your timing. Specifically, consider how long have you been unemployed and how much longer do you think it will last? If it is very recent and you were making good money before you might not immediately qualify for a Chapter 7 bankruptcy based on your prior income level. If you canât reasonably predict how long you will be unemployed you might consider several things is there another job on the horizon? Do you work in an industry where there is a great need and you can usually find a new job pretty quickly? Or was the loss of your job due to an injury or illness that will require some time to heal? If so, are you still facing more medical bills? A bankruptcy will only assist with existing debt, so if you are facing some large expenses you may want to wait to file.

Also keep in mind when you file bankruptcy with no money that your CMI is based on your average income over the last six months. This means that you may need to wait a little while to have your CMI average qualify you r a Chapter 7 bankruptcy. Even though the difference between your prior income and unemployment will feel very drastic immediately, it may not appear that way when averaged over the previous six months. Waiting an additional month or two to file will help your current monthly income to better reflect your current circumstances.

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