Things To Avoid Before Your Bankruptcy Case
When you are preparing to file for bankruptcy in South Florida, it is just as important to know what you should be doing to get ready for your case as it is to know what you should not be doing. There are a number of key actions or steps you should avoid before your bankruptcy case, and our West Palm Beach bankruptcy lawyers can discuss them with you. As you get ready to speak with a lawyer about the possibility of bankruptcy or to file for Chapter 7 or Chapter 13 bankruptcy, you should avoid all of the following, which could ultimately harm your bankruptcy case or your ability to receive a discharge.
Providing Inaccurate Information in Your Bankruptcy Petition
When you file for bankruptcy, it is critical to provide accurate and full information in your bankruptcy petitions, accompanying schedules, and any required documentation. You must be honest with the bankruptcy court about your income, assets, and debts, and failure to be honest could result in allegations of bankruptcy fraud. Even an omission (i.e., leaving something out of your bankruptcy paperwork) could be fraudulent. An honest mistake can be corrected, but even an honest mistake could jeopardize your ability to receive a discharge under the U.S. Bankruptcy Code.
Selling Exempt Assets to Try to Repay Some of Your Debts
Under Florida law, a variety of assets are exempt in a bankruptcy case. Accordingly, you will only be losing money from assets you could have kept if you liquidate certain exempt assets yourself with the aim of repaying certain debts or having cash on hand at the time of your bankruptcy filing. Any exempt assets should be left alone.
Taking Money Out of Your Retirement Account
When it comes to exempt assets, it is critical to know that your retirement accounts are likely exempt in full. As such, you do not want to take any money out of a retirement account before you file for bankruptcy. Not only will you incur a penalty and be required to pay tax on the amount, but once you take the money out of the retirement account, it is likely no longer exempt.
Transferring Assets to Friends or Family Members
You should never transfer assets to friends or family members prior to your bankruptcy filing. Sometimes people do this in order to avoid having assets liquidated. Even if you are not intending to engage in a fraudulent act, a transfer of property could look like bankruptcy fraud.
Charging “Luxury Items” to Your Credit Card Shortly Before Filing
You should not charge non-essential items to your credit cards 90 days prior to your bankruptcy filing. In particular, charging “luxury goods” or “luxury items” could result in allegations of bankruptcy fraud at work, and at a minimum, these debts will not be dischargeable in most bankruptcy cases.
Contact a West Palm Beach Bankruptcy Lawyer
Whether you are considering bankruptcy or you know you need help filing for bankruptcy, an experienced West Palm Beach bankruptcy attorney at Kelley Kaplan & Eller can begin working with you today. Do not hesitate to get in touch with us to find out more about the bankruptcy services we provide in South Florida.