Proof of Income
November 14th, 2008 by Questions
I`m thinking of filing for bankruptcy but the only income I receive is tutoring children privately. My payments are in cash and I have no pay stubs. What would I need to show the trustee for proof of income?
Posted from: British Columbia
One Response to “Proof of Income”
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November 14, 2008 at 9:04 am, A licensed trustee said:
You should be issuing receipts to your students – I realize with cash you probably haven’t been doing this so there’s no way to trace your income for tax purposes, but if you want to avail yourself of the bankruptcy laws you will need to keep an accurate record of your income and you’ll end up paying tax on this income too…
If you don’t feel that you are able to do this then you should expect your trustee to “determine for themselves” what your income is (likely based on your expenses and standard of living) and assess your payments to the bankruptcy based on this determination. I have to warn you, any time I have been forced to make this kind of “guess” at a client’s income I have guessed HIGHER than what they actually earned. In every case the client has decided to record it properly themselves to save themselves form higher bankrupty payments and income taxes…