What Happens To Your Inheritance During Bankruptcy?

  • Inheritance During Bankruptcy

What Happens To Your Inheritance During Bankruptcy?

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When you file for bankruptcy, your assets, income, and debts are all considered by the court for deciding the bankruptcy chapter. Any tax refund or inheritance you receive become part of your assets say lawyers of Dallas based bankruptcy law firm Recovery Law Group. If you think that after receiving your bankruptcy discharge you won’t have to be concerned about receiving an inheritance, you are wrong.

If a loved one dies leaving you an inheritance within 180 days from your bankruptcy filing, this money becomes part of your bankruptcy estate. This is dealt with by the bankruptcy trustee in a way they deal with other assets. This sum might be used to pay off your creditors during a Chapter 7 bankruptcy case. If you end up becoming eligible for any inheritance and are contemplating filing for bankruptcy, keep in mind the 180 days’ time period. This time frame specifies to the death of the benefactor of the inheritance and not the time when you receive the inheritance.

In the case of Chapter 13, you need to keep the bankruptcy trustee informed about any property you own. If you come into any inheritance, it will be used to pay off your creditors. It can be done anytime during the repayment plan (3-5 years). Thus, if you are expecting to receive any inheritance during your bankruptcy plan, you need to make arrangements regarding it. A bankruptcy attorney can help you with these issues. You can call 888-297-6023 to discuss bankruptcy and inheritance issues with experienced bankruptcy lawyers.