If I received life insurance money from my mother and I filed bankruptcy, do I need to disclose where the money went? 16 Answers as of November 24, 2014

I received life insurance money from my mother's passing 20 months ago. I am currently looking into filing chapter 7. Do I have to disclose where this money went almost 2 years ago?

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GARCIA & GONZALES, P.C.
GARCIA & GONZALES, P.C. | Richard N. Gonzales
Depends on how much money you inherited. For example, if you inherited $10,000 twenty (20) months ago, probably not. If you inherited $100,000 twenty (20) months ago, yes, you may need to do an accounting. That will be the Trustee's call. I would suggest you pay a lawyer for one hour of their time for some one-on-one guidance in your jurisdiction.
Answer Applies to: Colorado
Replied: 11/24/2014
Rhymer Law Firm
Rhymer Law Firm | William Rhymer
Possibly. The Statement of Financial Affairs asks for income sources for the two years before the petition date. I would definitely talk with a bankruptcy attorney and tell him or her what you did with the money. Then, you can better choose your options and timing.
Answer Applies to: Georgia
Replied: 11/21/2014
A Fresh Start
A Fresh Start | Dorothy G Bunce
You need to disclose everything your bankruptcy trustee asks you about, even though the bankruptcy forms do not specifically ask you about having received these benefits, since insurance benefits are not considered to be a form of income. Of course, if you still have any of the money, you must disclose it on Schedule B.
Answer Applies to: Nevada
Replied: 11/21/2014
EDWARD P RUSSELL | EDWARD P RUSSELL
Whatever assets you have at the time of filing must be put on the schedules and in order to keep them you will have to exempt them.
Answer Applies to: Minnesota
Replied: 11/21/2014
Stephens Gourley & Bywater | David A. Stephens
Unless it was a large sum, probably not.
Answer Applies to: Nevada
Replied: 11/21/2014
    The Law Offices of Kristy Qiu
    The Law Offices of Kristy Qiu | Mengjun Qiu
    If the amount was substantial (over 5 digits) then yes. There is really no place you have to disclose that information on the petition itself. The trustee, however, may ask questions regarding inheritance received within the past couple of years and seek proof of daily essentials spending if the amount received was substantial. And yes, life insurance proceed counts as inheritance.
    Answer Applies to: Florida
    Replied: 11/21/2014
    Richard B. Jacobson & Associates, LLC | Richard B. Jacobson
    In most cases you would not have to disclose where the money went. There are exceptions, however. If you gave away any substantial part of it within the last two years, for example, the Trustee will likely be interested. You should retain an experienced bankruptcy lawyer in your jurisdiction to assist with this kind of issue. Good Luck.
    Answer Applies to: Wisconsin
    Replied: 11/20/2014
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    You have to disclose your current assets. So if there is money left you have to disclose that.
    Answer Applies to: California
    Replied: 11/20/2014
    Deborah F Bowinski, Attorney & Counselor at Law | Debby Bowinski
    You must be prepared to provide an accounting of how that money was used. If you made significant gifts or transfers to others it could be problematic in a bankruptcy context. You also must disclose that you received the funds in your Statement of Financial Affairs. Bankruptcy can be quite complicated. I suggest you consider hiring an experienced lawyer to guide you through the process.
    Answer Applies to: Colorado
    Replied: 11/20/2014
    Stittleburg Law Office
    Stittleburg Law Office | Bernd Stittleburg
    Maybe, it depends on the Chapter 7 Trustee assigned to your case.
    Answer Applies to: Georgia
    Replied: 11/20/2014
    Garner Law Office
    Garner Law Office | Daniel Garner
    Yes, in general terms. You don't have to account for every penny, but the trustee will want to know if you have any left, and whether you made any voidable preference payments with it. Some preference payments can be avoided up to 4 years after they are made, meaning you would have to pay them back into the court or the trustee could pursue recovery from the recipient.
    Answer Applies to: Oregon
    Replied: 11/20/2014
    Danville Law Group | Scott Jordan
    The rules require disclosure going back the last 12 months. Unless, of course, you deposited it in an off shore account for your benefit, then you must disclose.
    Answer Applies to: California
    Replied: 11/20/2014
    D.J. Rausa, Attorney at Law | D.J. Rausa
    It will all depend on how much. Disclosure of income from all sources for the last three years is required to be disclosed. Since you received funds 20 months ago, you would have to disclose receipt. What you did with it would be a topic of future discussion after ascertaining the amount received, the amount of debt you have, when you incurred the debt, and what you did with the funds.
    Answer Applies to: California
    Replied: 11/20/2014
    Goldsmith & Guymon
    Goldsmith & Guymon | Marjorie Guymon
    In Nevada, we have an exemption for life insurance proceeds. So while you may have to disclose where the money went the fact remains that the funds were exempt and you can spend them as you like. The issue may come up in that you may have assets that you acquired with those funds which are now not exempt and which require disclosure.
    Answer Applies to: Nevada
    Replied: 11/20/2014
    Ronald K. Nims LLC | Ronald K. Nims
    There is no requirement that you disclosure any spending that occurred two years prior to filing bankruptcy. However, there is a requirement that you disclose gifts and loan repayments to family members for the past four years. If you invested the funds, you would have to disclose the asset which you acquired.
    Answer Applies to: Ohio
    Replied: 11/20/2014
    Musilli Brennan Associates PLLC
    Musilli Brennan Associates PLLC | John F Brennan
    NO firm answer, in Michigan it is possible to go back 6 years to reverse fraudulent transfers. SEEK COUNSEL!!!
    Answer Applies to: Michigan
    Replied: 11/20/2014
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