If you are filing a Chapter 7 or Chapter 13 bankruptcy be careful how you calculate your income. Does your employer pay your rent or mortgage? Do you drive a company car? What about travel expenses to and from work? Do you use the company credit card to pay for personal items? All of these perks are counted as income under bankruptcy law. In bankruptcy, this type of income is considered non-traditional income and if it is not reported or reported inaccurately it can jeopardize a debtor’s bankruptcy discharge.For example, if you use your company credit card to pay for personal utilities, such as a phone, gas or electricity, this will be counted as income in bankruptcy. Of course the exception will be if you have to pay those expenses back to the employer. Another example would be if you employer paid for a vacation for you and your family, which sometimes is a perk of executives. This also would be considered income. The bankruptcy court will assess each perk a value and that value will be counted as income.
If you’re filing for bankruptcy and have employee perks, talk to your bankruptcy attorney about how those perks will be counted as income during your bankruptcy case.