Given the intricacy of bankruptcy law, it is crucial to deal with an experienced Orlando bankruptcy lawyer whether you want to file for Chapter 7 or Chapter 13 bankruptcy. To be sure, the U.S. Bankruptcy Act has a great deal of nuance, and it can be quite challenging for consumers to comprehend all of their obligations and rights when it comes to filing for consumer bankruptcy. The “180-Day Rule” is one of these difficult areas of bankruptcy law. Learn about the 180-Day Rule and how it can affect your Chapter 7 bankruptcy case. Consider taking help from a lawyer.
Cases when bankruptcy is being filed alongside the anticipation of an inheritance
If an Orlando debtor is expecting an inheritance, the 180-Day Rule will likely apply (or has already received an inheritance). The rule’s bare bones are as follows: if you inherit property less than 180 days before you file for bankruptcy, you might not get to keep it. An inheritance may also have an impact on the size of your Chapter 13 repayment plan, however this may vary based on the specifics of your case.
The 180-Day Rule is intended to prohibit a debtor from using bankruptcy to eliminate debt and protect an inheritance.
A bankruptcy filing and an inheritance can be a bad idea.
A few things to keep in mind if you’re expecting to inherit property soon, or have already inherited property, and are considering filing for bankruptcy:
If you get an inheritance before declaring bankruptcy: Any inheritance is considered part of the bankruptcy estate unless it qualifies for an exemption (which we will explore later). Hence, if you declare Chapter 7 bankruptcy, your inheritance could be sold off together with your other non-exempt assets.
If you get an inheritance within the bankruptcy’s first 180 days: Once again, inheritances are not excluded from becoming part of the bankruptcy estate. Also, depending on the nature of the inheritance, U.S. bankruptcy law may force you to modify your bankruptcy schedules.
If you get an inheritance after you file for bankruptcy, but before the 180-day mark, the inheritance will not be considered part of the bankruptcy estate, and you will be permitted to keep it. Never mind worrying about whether or not it qualifies for an exception.