If you are expecting an inheritance, or even if you are not, the special rules about them are worth your attention to prevent bad surprises.
If you are the beneficiary in a spendthrift trust, most likely a bankruptcy trustee can’t touch whatever property is in that trust.
If you have a power of attorney over someone’s assets, or any similar power, those assets are not affected by your bankruptcy case.
To find out if you can keep everything you own in a Chapter 7 case, the first step is finding out what’s in your bankruptcy estate.
You hear in bankruptcy about the “trustee,” and maybe about the “U.S. Trustee.” They’re clearly easy to confuse. Who’s the U.S. Trustee?
There’s a lot more to using property exemptions than just matching them to your assets. There are benefits worth taking advantage of.
Most of the time you get to keep everything you own when you file bankruptcy. It’s all covered by property exemptions. But not always.
Usually you use the property exemptions available for the residents of your state. But not if you haven’t lived there long enough.
What happens when your bankruptcy trustee thinks you undervalued an asset? How does the trustee determine what you own and its value?
Usually everything you own is exempt (protected). But what happens if you own an asset that is not exempt? What does the trustee do? Chapter 7 is the “liquidation” form of bankruptcy. But in our last blog post we introduced the bankruptcy trustee as an only sometimes liquidator. That’s because in most Chapter 7 cases nothing gets liquidated. Nothing … Read More
Besides your creditors, the main person you need to be careful about in a “straight bankruptcy” Chapter 7 case is the trustee. Who’s that?
If you owe “priority” debts like income taxes and/or support payments, you may be able to pay no more while protecting a transferee.
Overall, Chapter 13 can be more powerful and more flexible than Chapter 7. That often also applies to a fraudulent transfer.
Charitable donations made during the two years before filing bankruptcy may fall within a safe haven of not being fraudulent transfers.