Bankruptcy Filing on Your Horizon? - Take Some Simple Steps to Protect Potential Future Inheritances

July 2, 2012

SAS2013 Bankruptcy can help you make a fresh start and provide tremendous emotional relief, but it may also negatively impact any potential future inheritances that you may be entitled to receive.

In general, when you file a chapter 7 bankruptcy, a snapshot is taken of your finances. Any debts that you owe as of the moment you file the case can be discharged, (with some exceptions,) and all of your assets as of the moment you file the bankruptcy case become part of the chapter 7 estate.

The assets in the estate may be liquidated by an official called a bankruptcy trustee to pay your creditors. (Note, however, that an experienced attorney can usually assist you in exempting most personal assets from the estate, such as a car, a house, some money in the bank, retirement accounts, personal effects, etc.). Any assets you acquire after the filing of the case are yours to keep, free from any debts.

There is a big exception to this general snapshot rule, however; any property that you become entitled to as a result of someone’s death within 6 months after the bankruptcy filing may also become property of the bankruptcy estate. ...

You may read more at the link below.

by: Spencer A. Stone

BusinessWest
July 2, 2012

Download the full PDF version: