When you file for bankruptcy, you must complete a packet of forms providing detailed information about your income, expenses, assets, debts, and financial transactions. On Schedule I, one of these required forms, you must list your current income, less allowed deductions. This article explains how to complete Schedule I.
What Is the Bankruptcy Schedule I?
On Schedule I, you must provide information on your current income. Your income can come from any source, including wages, pensions, Social Security benefits, disability benefits, child support, and alimony. Many debtors may be surprised to find that financial assistance they receive from family or friends (including a roommate that may be covering living expenses) also counts and must be listed on the form.
If you are married, you must provide income information for your spouse as well, even if you are filing separately for bankruptcy.
Different Income Amounts on Different Forms
As you may know, the 2005 amendments to bankruptcy law now require filers to pass a "means test." This test, based on the debtor's income and expenses, is intended to determine whether the debtor could afford to repay some portion of his or her debts and, therefore, should be required to use Chapter 13 rather than Chapter 7. You take the bankruptcy means test by completing bankruptcy Form 22A.
Part of the means test requires you to list your "current monthly income." However, for purposes of the means test only, this figure represents your average monthly income during the six months before you file for bankruptcy. On Schedule I, you list your actual income at the time of filing, which may be different. Also, Form 22A requires you to list your gross income, while Schedule I asks for your net income. For these reasons, the "current income" amounts you list on each form may be different, and that's okay.
Allowable Deductions on Schedule I
On Schedule I, you may subtract your payroll deductions. If you receive a paycheck or stub, these deductions have probably been calculated for you. There are three deductions that are specifically allowed on the Schedule I form under Item 4:
- Payroll taxes and Social Security
- Insurance
- Union dues
The fourth deduction under Item 4 is listed as “Other (Specify).” This is where debtors must list all other deductions from their income. These can include deductions for 401(k) plans and other retirement contributions; parking fees, uniform and lodging deductions; alimony and child support deductions; and deductions to pay state temporary disability taxes.
It is important to be as honest and accurate as you can when completing Schedule I and all the rest of yoru bankruptcy forms. Much of this information can be verified independently through reviewing your tax returns (which you must provide to the trustee) and other financial records. If you are caught lying about your income, assets, debts, or other financial facts, your whole bankruptcy case could be at risk.
