Your local bankruptcy lawyer that you hire will prepare your bankruptcy documents and one of the most important documents are your schedules. Schedules are a snapshot of your financial situation on the day that your case is filed. It is extremely important that your schedules be accurate because creditors and trustees will be reviewing them. If you try to hide assets or lie on your schedules, you could face federal prosecution for bankruptcy fraud.
There are three sections to your bankruptcy schedules: assets, debts, and financial information. The first section is your assets and are listed on Schedules A/B and C. Assets are items that you own which have a value that can be measured and expressed in dollars. The most common assets which people own are real estate, vehicles, household goods and furnishings, clothing, jewelry, and bank accounts. The value of real estate assets are measured by the tax appraisal value or by getting a private appraisal. Vehicle values are generally measured by Kelley Blue Book or NADA. Most of the other items are valued by replacement value – how much would it cost to replace that item with another in the exact same condition. There are other assets you should disclose when filing such as 401(k) accounts, cash value in whole life insurance policies, and any kind of lawsuit in which you are suing someone. Anything that you own or have an interest must be listed on Schedules A/B and C.
The second section of your schedules are your debts. They are divided into three parts – secured, priority, and unsecured. Each debt must include, at a minimum, the creditor’s name, address, type of debt, and the amount owed. Schedule D lists your secured debts along with the property which is collateral for the loan. Schedule E is a list of your priority debts such as tax and child support debts. Schedule F are all of your unsecured debts such as credit cards and medical bills. It is very important to list every debt that you owe in one of these debt-schedule sections because if you do not list a debt, you may have to pay it after your case is completed since that creditor did not receive notice of your case.
The final section of your schedules is your financial information, such as your monthly income and expenses. These are Schedules I for income and Schedule J for expenses. For Schedule I you must list all sources of household income, including wages, retirement, social security disability, business income, and rents from rental property. If you are filing without your spouse, you must still use your spouse’s income because the schedule includes all income in the household. If you are working, you will need the gross amount of your wages and also all deductions from your paycheck. If you are self-employed or own an interest in a business, the trustee may require profit/loss statements to proof your income. For Schedule J expenses you should list all expenses that you pay each month. If you pay some expenses quarterly or annually, you should divide that amount so that you come up with a monthly figure.
After reviewing your schedules, you will sign a statement which verifies that all information is accurate to the best of your knowledge. There can be a lot of pages to your schedules, but they are extremely important to your creditors and trustees because the information you provide in the schedules is used to determine how to proceed in your case. If you are unsure about whether you should include something in your schedules, it is best to tell your bankruptcy attorney everything and then let the debt relief attorney advise you how to proceed. Call today for a consultation with our bankruptcy lawyer in Birmingham.