My children receive social security benefits. Do I include this as income in my bankruptcy?

Upsolve is a nonprofit tool that helps you file bankruptcy for free. Think TurboTax for bankruptcy. We also provide free education, customer support, and a private community. Over 2 million web visitors since 2018. We never ask for a credit card. Funded by generous donors like Harvard University and featured 4x in Forbes. Explore Tool Now


In a Nutshell

There are two locations in your bankruptcy forms where income has to be disclosed, the means test and your Schedule I. This article explores whether and when you should include social security benefits your child receives as part of your household income in your bankruptcy forms.

Written by Attorney Andrea Wimmer.  
Updated July 22, 2020


There are two locations in your bankruptcy forms where income has to be disclosed: 

  1. Chapter 7 Statement of Your Monthly Income, Official Form 122-A1 (the Means Test)

  2. Schedule I: Your Income, Official Form 106I

The Means Test

Social security income is never included in the means test calculation of your household income. So, regardless of who receives the social security benefit, do not include it as income on your means test.

Schedule I

Schedule I provides the court and your trustee with an overview of your income going forward. It’s intended to illustrate your (in)ability to pay for necessities and keep making payments to your creditors going forward. Unlike the means test, the numbers are forward looking and not a historical average. 

If you use a portion (or all) of the social security benefits you receive for a dependent to pay for living expenses, you should include this amount on your Schedule I. It fits best in line 8f - as other government assistance that you regularly receive as you can indicate that the benefit is for your minor child and not yourself. 

Statement of Financial Affairs

If you don’t use the funds for living expenses at all, putting the full amount in a bank account for your minor child instead, don’t include it as your household income on your Schedule I. After all, it’s not available to pay for household expenses. In that case, make sure that you let the court know whether you’re an authorized user or joint owner of the bank account you’re making the deposits to in response to question 23 on the Statement of Financial Affairs. This will help avoid confusion down the line in case the trustee sees that you’re making deposits into this account from your account. You don't have to list your child's social security income in response to Question 5 (Did you receive any other income during this year or the two previous calendar years?).

Conclusion

If you use the social security funds your child receives as part of your household budget, make sure you disclose this on your Schedule I. Keep in mind, however, that it’s not part of your household income under the means test calculation and you can never be forced to use it to pay your creditors. 



Written By:

Attorney Andrea Wimmer

TwitterLinkedIn

Andrea practiced exclusively as a bankruptcy attorney in consumer Chapter 7 and Chapter 13 cases for more than 10 years before joining Upsolve, first as a contributing writer and editor and ultimately joining the team full time in August 2019. While in private practice, Andrea ha... read more about Attorney Andrea Wimmer

It's easy to get help

Choose one of the options below to get assistance with your bankruptcy:

Free Web App

Take our bankruptcy screener to see if you're a fit for Upsolve's free web app!

Take Screener
5117 families have filed with Upsolve! ☆
OR

Private Attorney

Get a free bankruptcy evaluation from an independent law firm.

Find Attorney
3493 people found attorneys this month

Questions about bankruptcy?

Research and understand your options with our articles and guides.

Go to Learning Center →

Already an Upsolve user?

Read Support Articles →

Upsolve is a 501(c)(3) nonprofit that started in 2016. Our mission is to help low-income families who cannot afford lawyers file bankruptcy for free, using an online web app. Spun out of Harvard Law School, our team includes lawyers, engineers, and judges. We have world-class funders that include the U.S. government, former Google CEO Eric Schmidt, and leading foundations. It's one of the greatest civil rights injustices of our time that low-income families can’t access their basic rights when they can’t afford to pay for help. Combining direct services and advocacy, we’re fighting this injustice.

To learn more, read why we started Upsolve in 2016, our reviews from past users, and our press coverage from places like the New York Times and Wall Street Journal.

Close

Considering Bankruptcy?

Try our 100% free tool that thousands of low-income families across the country have used to file bankruptcy themselves. We are funded by Harvard University, will never ask you for a credit card, and you can stop at any time.

File Bankruptcy for Free