Projecting Income In Bankruptcy

Projecting Future Income in Bankruptcy

When projecting future income in bankruptcy, debtors must determine what they can reasonably expect to earn in the near future.

Below are few income scenarios that bankruptcy debtor’s may face:


If a bankruptcy debtor is unemployed at the time of filing bankruptcy, their only projected income may be unemployment benefits. However, if they are receiving alimony, child support or other income, even if it is sporadic, they need to include that in their income projections for bankruptcy.

Part-Time, Temporary Or Sporadic Work

If a bankruptcy debtor is working part-time or temporarily they may need to work with their bankruptcy attorney to come up with the best future income estimate they can.  In Chapter 7 bankruptcy , the projected income estimate may not be as important as it is in Chapter 13 bankruptcy where the debtor’s monthly payments are based on projected income.  For example, if the bankruptcy debtor works in a field which doesn’t offer a regular paycheck, such as sales, they may not be able to provide an exact projection of their income. In that case, they will need to come up with a projection based on their current earnings and earnings from the past tax year.

Income Changes

Sometimes a debtor may file bankruptcy right before they find employment. If this is the case and the debtor knows they will begin work at a new job, they must inform the bankruptcy court of this fact. If the bankruptcy debtor knows how much salary they will earn, they need to include that in their projected income statement. But the bankruptcy debtor should only include this income if they know for a fact they will get the job.