There are several ways to commingle funds. The first way to commingling funds is sharing bank accounts with a non-filer. Generally, its best to keep all bank accounts separate and have all your income and expenses going out of one checking account.

Otherwise, it could be perceived by the trustee, as a gift if any money is going into someone else’s bank account. The second way to co-mingle funds is to keep your business income and personal income in the same checking account.

It is always best if you operate a business to keep all income and expenses of the business coming out of a designated, separate bank account. Only transfer to the personal account your payroll or distributions to pay your personal expenses. The third way to commingle funds is to put money from a variety of sources into the same bank account.

It’s possible for different sources of income to have different exemptions. For example, wages from a job can be exempted up to 75%. Social security income is 100% exempt. Pension income, depending on the type, have different exemptions. Alimony has a separate exemption, as does VA disability.

Ideally, it is best to keep each in a separate account so it’s being exempted correctly when the bankruptcy petition is filed, and you are not commingling exempt funds with non-exempt funds. Another example is putting in a tax refund, or personal injury settlement, into the same account as wages.

In that case, that money might have to be spent down reasonably so we know the source of any money left in the account is wages that would be exempt. The lesson is to keep everything transparent and separate so it’s easy to see the source of the deposits and any expenses coming out of the account.

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