In some circumstances, delaying a bankruptcy in Fort Worth can make more sense than filing immediately. For instance, a postponement may allow the filer to retain more of their property, become eligible for chapter 7 and discharge more debt. Read further to learn when and why it makes sense to delay filing for bankruptcy through.
A Move to a New State Allows for Greater Property Exemptions
If a person has recently moved to a new state, they must stay there for two years before using its bankruptcy exemptions. Filing sooner requires the use of the previous state’s rules. If the new state offers greater exemptions, it may make sense to put off filing until it’s time to use them.
Income Has Decreased Significantly
When assessing eligibility for chapter 7, or determining the amount to be paid to unsecured creditors in chapter 13, the means test uses the average income for the six months before filing. If one loses a lucrative job, waiting to file can lower the average and, potentially, make them eligible for chapter 7.
The Filer Has Older Tax Liabilities
While it is possible to discharge certain tax debts in bankruptcy, it’s not easy. Before a tax debt can be discharged, it must reach a certain age. If a client wishes to discharge a tax liability, they may need to wait until the timing is right and all other conditions are met.
New Credit Card Charges
If a debt is taken out without intent to repay, it’s regarded as fraudulent and cannot be discharged. The presumption of fraud gives creditors the motivation to challenge more discharges, but delaying filing can put the client outside the window and make it more difficult for creditors to prove fraudulent activity.
Property Was Recently Transferred to Another Person
If the client transfers property to another person’s name before a bankruptcy in Fort Worth, they may be able to avoid the property transfer and get the asset back. However, if transfers are done with the intent to defraud creditors or conceal assets, discharge loss and criminal prosecution may occur. The consequences depend on timing and whether the receiver paid the fair market value of the asset. Delaying bankruptcy can help clients avoid challenges from creditors. Visit David S. Kohm & Associates for more details.
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