Chapter 7 and Inheritances

What happens if, after you file for a Chapter 7 bankruptcy, a parent, spouse or other family dies leaving you some money or other items of significant value? Does this affect your bankruptcy? Are you entitled to keep the inheritance or must you turn it over to the Trustee or your creditors? The answer to these questions is, of course, it depends. What does it depend on? Let’s discuss. You file for a Chapter 7 bankruptcy. You are a typical “no asset” case, meaning you don’t have any assets to be liquidated and distributed to your creditors. You may or…

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I can’t file for bankruptcy – I’ll lose my house (car, boat, etc.)!

  This has got to be the #1 misconception I hear on an almost daily basis from people. They often refuse to consider filing for bankruptcy relief because they believe, often incorrectly, that they will lose their home or car. This is not necessarily true and one should not refuse to consider bankruptcy as an option under the (oft-mistaken) belief that it always is true.  Let me explain. For the purposes of this discussion, I am going to focus on the more frequently used chapter of bankruptcy law – Chapter 7. This is the chapter under which you get rid…

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Can I keep my tax refund if I file for bankruptcy?

Yes…. maybe. If you are planning to file for bankruptcy and have gotten (or expect to get) a tax refund, you should plan carefully so you can keep all or part of that refund. If possible, you should file your tax return and get and spend your refund on permissible purposes prior to filing. Your refund is an asset, whether it’s cash in hand or you have the right to receive it in the future. If you wait until after filing for bankruptcy to file your return, or do not get your refund until after filing for bankruptcy, the Trustee…

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Can I file for bankruptcy and keep my house?

Maybe. That may seem like a typical lawyer answer, but it is the most accurate one. Most outcomes are dictated by a combination of the facts as they are applied to the law. This question is no different. Sometimes a person can file for bankruptcy and keep their home. Sometimes they cannot. The answer depends on a variety of facts that change from case to case. Some of the factors that determine that outcome are the following: Do you have a mortgage? Are you current in your mortgage? Do you have any other mortgages, lines of credit or other liens…

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