A bank statement showing your current balance in each of your accounts is crucial information for your signing appointment. Your bankruptcy petition presents the court and trustees with a snapshot of your financial picture at a moment in time.
Keep the moment in time notion in the front of your mind. Your bank account is a constantly moving animal. Money goes in, comes out, interest is earned or charged, not to mention the bank fees for the pleasure of doing business. The current balance shown on a bank statement is an asset which must be disclosed on schedule B of your petition.
Once the balance in each of your bank accounts is scheduled, the next step is to apply Ohio’s minimal exemption to it. At this writing that protected amount is only $425.00. That is why I counsel that we should file when your bank balance is lower than that threshold. It is still possible to apply the wild card exemption of $1,150, but often we want to use that to protect some other hard asset.
The amount that is scheduled for bankruptcy purposes is that amount which would be currently available to a creditor attempting a bank attachment. Do you have outstanding checks? How about debit card transactions that haven’t cleared? They don’t count for bankruptcy purposes. If the money is there at that moment in time, it is part of your bankruptcy estate.
Don’t try to guesstimate your bank account balance prior to the signing appointment. You will be wrong. Don’t assume a debit transaction has cleared. Get an actual print out from you bank branch, or a printout of your account online for the date of the signing appointment. That is proof of what you have at that time if you need it later.
If your balances are too high, you can arrange to come back in a few days to sign when they are within range.
What happens if you understate a bank statement balance in you bankruptcy petition? In most cases nothing so long as the non-exempt amount is just a few hundred dollars. A greater amount becomes problematic. When can it be a problem?
- it is over about a thousand dollars or more,
- any amount if the trustee is administering other assets
The real injustice happens when you give me a number for your petition which has subtracted uncleared transactions. If you understate a moment in time bank statement balance your creditors can be entitled to the money, even if it cleared and the money is no longer in your account. You will have to make up this difference. A little like paying twice isn’t it? Just do what I ask, bring me what I need to do your petition. That way I can protect you and your assets from you creditors. Isn’t that why you want to file bankruptcy?