Legal Question in Bankruptcy in Minnesota

Well, this question comes to me under the category of bankruptcy.

If you are thinking of filing a bankruptcy any time in the next six years, making a gift of something of value to a friend or relative is very probably a bad idea. Especially if you are thinking of a Chapter 7.

The Minnesota fraudulent transfer statute looks back six years. Transfers during that time can be viewed as being for the purpose of hiding an asset from creditors. An exception would be if you sold it for fair market value.

If you transferred something of value as a gift to relatives and then filed a Chapter 7 bankruptcy soon afterwards, you can expect that the trustee would take that item away from whoever you gave it to.

For some reason it seems that many of the people who come in to see me do so right after doing something like this that really makes their case more difficult. I strongly suggest that you make an appointment to see a bankruptcy lawyer and do nothing, NOTHING, until after you have had a really good consultation with that lawyer.

This response is for general information purposes only and does not create an attorney-client relationship. It is not legal advice.