If you are considering filing for bankruptcy then you should know up front that all assets, including all income must be disclosed to the bankruptcy court. Failure to disclose an asset or income could cause you to not receive a bankruptcy discharge of all of your debts. While in most cases nobody comes to your house to look for assets or money hidden under your mattress you should always tell the truth to avoid any future problems in your bankruptcy case.
After your initial bankruptcy consultation with an attorney, you will be required to fill out a bankruptcy questionnaire where you will again be asked to disclose all of your assets including all income. This income should include any under the table income as well as any monies received is considered income and needs to be reported to the bankruptcy court and to to your assigned bankruptcy trustee. All bankruptcy cases are reviewed by the US bankruptcy trustee to make sure you are within the income limits and are qualified to file for chapter 7 bankruptcy or that your chapter 13 payments are where they should be at. Clients have to realize that they must answer the bankruptcy questionnaire as honestly as possible or risk having their bankruptcy case dismissed or even converted from a chapter 7 to a chapter 13 bankruptcy.
If you do not report your income properly your bankruptcy cases may be objected to by the US trustee or your creditors in which additional legal costs and heartache may be incurred. These expenses and stress can be avoided if you fill out the questionnaire correctly in the first place. HERE is a good article on informing your attorney of all possible income when filing bankruptcy.