Understanding Schedules G, H, I and J in Bankruptcy
Understanding Your Bankruptcy Filing: Schedules G, H, I, and J
Unexpired Leases – Schedule G
This schedule is required in all bankruptcy cases, regardless of which chapter you have chosen to file. The purpose is to make sure that the trustee in your bankruptcy case is aware of any leases you have that are unexpired. The most common unexpired leases that we encounter among our clients are residential and car leases.
Another term for an unexpired lease is an executory contract. A simple definition of an executory contract is a contract where both parties (such as you and your landlord) have not yet completed all the terms of the contract. So in the case of a lease, you have agreed to pay a certain amount to rent a home or apartment and your landlord agrees to provide you with a place to live, perhaps perform certain maintenance, etc…. Each person who signs the contract has an obligation that is not yet completed. Another example would be when you have a contract pending on the sale of real estate or other property/goods.
Codebtors – Schedule H
If you have codebtors you will need to list them in Schedule H. Spouses are only included in this section if you are not filing joint bankruptcy. In a community property state like Arizona, if you have a spouse that is not filing jointly, you will need to list his or her name and address and any other names used in the last 8 years.
Income and Expenses – Schedules I and J
The two final schedules are for you to fully disclose your income and expenses. Depending on the chapter we’ve chosen for your bankruptcy, the income and expense schedules serve different purposes. In a chapter 7 bankruptcy, these two schedules may help the court ensure that your filing is not an abuse of the bankriuptcy laws and thus subject to dismissal.
In a chapter 13 bankruptcy, the trustee and your creditors will use the information you provide to determine if you have proposed a reasonable payment plan. Both your creditors and the trustee have the right to object to your plan confirmation. Schedules I and J provide needed information for determining if they will raise an objection. The court also uses the information you provide here in making decisions about how long your payment plan will be and if the plan is the your “best effort.”
If you are married and filing a joint case, you will report income of both spouses. If only one spouse is filing bankruptcy, you also include income from both spouses. The exception to this is if spouses are separated and there is not joint filing. If you receive income from someone who is not a spouse, then you will list this as “other monthly income” on the schedule.
Other income that you include in Schedule I will be business or farm income. If you receive income from a business you will include a detailed statement in addition to the information on Schedule I. If you receive public assistance such as food stamps, you include this in your bankruptcy filing. Another consideration when filling out the income schedule is if you are supposed to receive domestic support payments, but have not historically received them. This information should be noted so that the trustee and court are aware of your actual income picture.
Schedule J will provide the trustee and the court with information about your monthly expenses. If spouses file jointly but have separate households, you will indicate this in the schedule. If someone else pays for household expenses and that income wasn’t included in Schedule I, you will put the expense amount as $0 with that information noted. Just as in Schedule I, if you have expenses from a business or farm, you will attach a report of these expenses.
Most individuals filing for chapter 7 bankruptcy have usually reduced their expenses to such an extent that they will need to consider items that have not been included in their monthly expenses prior to bankruptcy filing. For example, many families will put off medical exams or dental work during times of financial stress. It may be that a family needed to drop their health or life insurance coverage. These expenses can be legitimately included in Schedule J.
Another example of expenses to include in Schedule J would be home maintenance that has been deferred. Some individuals filing bankruptcy will also forget to include other expenses such as haircuts, school and activity expenses, and reasonable expenses for clothing. Remember that projecting your expenses on Schedule J is not an exact science. It is your best, good faith estimate.
In a chapter 13 bankruptcy, we will look at both the income and expenses to ensure there is enough income reported to cover the proposed payment in your plan. Alternatively we will also ensure that your expenses are not underreported to such an extent that you show excess income in your filing. As always, we will use good faith and reasonable estimates that maximize the outcomes needed in your bankruptcy.
We will also need to anticipate any changes in your income or expenses for the next year after filing.
Declaration – Your Oath
Part of the bankruptcy filing includes a form called the “declaration.” You will sign this form after reviewing all of the information we have prepared in the schedules. Your signature on the declaration is an oath that you have reviewed all of the information on the schedules and the information, to the best of your knowledge, is true.
Summary of Schedules
Along with all of the schedules, we prepare a required summary sheet that pulls together all of the information in one page about your property, expenses, debts, and income.
As your bankruptcy attorneys, we want to ensure that you fully understand the process you are going through. It may seem like a maze of paperwork and requirements. We work with you as a team to ensure that you include everything needed in your filing. Because we have worked with thousands of individuals and families over the decades, we are familiar with almost every possible situation.
Contact our office today to set up a free consultation so that we can discuss your desired outcomes and determine if bankruptcy is the best choice for you. We work to ensure that each client fully understands all of their options, makes the best choice possible, and takes full legal advantage of the bankruptcy process.