retro pay owed and filing for bankruptcy
June 18th, 2009 by Questions
I am filing for bankruptcy next month and have just found out we are possibly getting a pay raise and will be owed retro pay for approx 2 years which will equal 3-4 thousand. My question is becuase this money should have been paid to me before what will happen to it? It will be added to my pay and I don`t want to owe more surplus income.
Posted from: Ontario
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June 20, 2009 at 5:05 am, A licensed trustee said:
I am soory, but if you receive this retro-pay and you have already filed for benakruptcy then it will be subject to the surplus income rules and likely you will have to pay a portion of it to your trustee.
I guess you should weight that against the amount of your debt to determine if it makes sense to file – frankly, I suspect you owe more than the amount of your retro-pay and so (while unfortunate) it’s just part of the cost of using the bankruptcy laws to get rid of your debts.