What Happens if my Family Income Changes
While I am in Chapter 7?
The timing of events can have a significant impact on your Chapter 7 case. If your household income increases after you file Chapter 7, you are obligated to report this change to your Chapter 7 trustee. Further, if there is a significant change in your income within the six month period following the issuance of a Chapter 7 discharge, this income information should be reported as well.
If your income increases to the point where you have disposable income, you may be required to convert your case to Chapter 13, or your case may end up being dismissed.
At your Chapter 7 Meeting of Creditors (your 341 hearing), your Chapter 7 trustee will ask you if anything in your petition has changed. Remember that your testimony at your 341 hearing is under oath.
If you receive an unexpected one time bonus or lump sum payment, that payment may not result in the dismissal of your case. Sometimes these lump sum payments can be declared as exempt property and you will be able to keep some or all of the unexpected money.
We encourage you to contact our office as soon as you find out about any significant change in your income so we can advise you appropriately.
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