Are you considering filing for bankruptcy in Atlanta, Georgia? Whether you file a Chapter 7 or a Chapter 13 in Atlanta, Georgia, you want to avoid certain things before you file bankruptcy.
The most important thing is you can protect and keep all of your property in bankruptcy. Study the following advice from a Georgia bankruptcy lawyer with expert legal experience to ensure that your bankruptcy case proceeds smoothly and successfully.
Advice for Filing Bankruptcy in Atlanta
Incurring new debt
If you are planning on filing bankruptcy, Atlanta bankruptcy attorneys insist that you not incur any new debt. Such an act could constitute bad faith. Specifically, bankruptcy laws adopted by Georgia presume certain purchases to be non-dischargeable before a bankruptcy filing.
- Any cash, check, credit card, or virtual charge of $600 or more on luxury goods within 90 days of a bankruptcy filing
- Cash advances totaling more than $875 within 70 days of a bankruptcy filing
- Large payments to creditors, especially to “insiders” (relatives or business partners) of $600 or more within 90 days of a bankruptcy filing
- Any payment to an “insider” within a year of filing for bankruptcy
You can review the United States Bankruptcy Code 11 U.S.C. Section 523(a)(2)(C)(i)(I-II)) here.
Certain payments listed above could pose a problem in your case because they cannot be considered transfers subject to reversal in a process known as avoidance actions. The bankruptcy trustee can file an action to unravel the payments and recover the money for the benefit of all the creditors based on the premise that all creditors should be treated equally. Payments to some creditors and not others are known as preference payments.
Bankruptcy in Atlanta, GA Regarding Retirement Accounts
Transfers or sales of property
Bankruptcy lawyers urge you not to transfer or sell a property for less than fair market value within two years before filing for bankruptcy in Georgia. Although this sounds like a difficult rule to follow, the essential meaning is to not transfer any property without receiving fair market value for it. For example, if you owned a car outright and transferred it to your mother for one dollar, that would be a fraudulent transfer subject to reversal by the bankruptcy trustee. On the other hand, a transfer that arises out of the normal courts of business, such as a trade-in or sale of a vehicle to a dealership would probably be okay. If you think you can put something of value in someone else’s name to avoid losing property in bankruptcy, you are wrong, so don’t do it.
Liquidation of 401(k) or other retirement accounts
Do not liquidate any retirement funds before filing for bankruptcy in Atlanta. The liquidated funds must be counted as income on the bankruptcy means test, which may cause you to not qualify for Chapter 7 or have to pay a higher percentage back to unsecured creditors in Chapter 13. Also, having a lump sum of cash that is not held in a retirement account could subject your money to taking by the bankruptcy trustee. On the other hand, unliquidated retirement accounts are fully protected from taking in bankruptcy in Georgia.
Bankruptcy Attorney Atlanta
The precautions above are not an exhaustive list of no-nos for filing bankruptcy in Atlanta. Yet, they cover some major issues that could complicate a bankruptcy filing. Are you looking for a free consultation regarding Chapter 7 or Chapter 13 bankruptcy cases in Georgia?
Contact the Law Offices of Charles Clapp, serving Atlanta and the surrounding areas. Take a look at Charles’ profile or read his outstanding reviews from happy clients. Or, call the law firm directly at (404) 585-0040 for a free consultation on how you can get debt relief fast.