Legal Question in Bankruptcy in California

Re: gifting money to child before bankruptcy

BIG problems. If the money is not in a qualified account, such as a 529 Education plan, then it is your property. As such, any transfer of your property to relatives within two years preceding the filing of a bankruptcy would be a fraudulent conveyance and/or avoidable preference. The Trustee could and will seek to recover that money from the children, and pay it out to your creditors. If you are going to be filing anytime soon, you need to meet with a bankruptcy attorney right away and discuss what the implications of that cash are. Please feel free to email or call my offices off the list to discuss further.

*Due to the limitations of the LawGuru Forums, The Gibbs Law Firm, APC's (the "Firm") participation in responding to questions posted herein does not constitute legal advice, nor legal representation of the person or entity posting a question. No Attorney/Client relationship is or shall be construed to be created hereby. The information provided is general and requires that the poster obtain specific legal advice from an attorney. The poster shall not rely upon the information provided herein as legal advice nor as the basis for making any decisions of legal consequence.