Legal Question in Bankruptcy in New York

Bankruptcy and Supplemental Needs Trust

I am in the process of filing Chapter 7.

I have just found out that I will get $12000 payment for back wages from 2005 from previous employer.

I want to set up a Supplemental Needs Trust for this money to protect it from any of the creditors getting their hands on it when the bankruptcy is filed. I am HIV+ so am qualified to set one up.

Can you tell me if one is set up for me with this money , do I do it before we file the bankruptcy? and is there any chance that the creditors could get any of that money?

I am currently going to graduate school and this money will enable me to pay for college costs that arent covered by scholarships or grants.

Another option is for me to spend all this money before file for the bankruptcy so the money wouldnt be there for the creditors? but i would think that the court would nol look too well on this. And really dont want to have to spend all that money right now.

Any assistance that you could give me on this issue would be greatly appreciated.

Thanks,


Asked on 6/29/08, 2:53 pm

1 Answer from Attorneys
Nancy Delain Delain Law Office, PLLC

Re: Bankruptcy and Supplemental Needs Trust

The answer to your question depends very very heavily on individual answers to questions that your attorney will ask you. Hire one. This is too complex a matter for this board.

DO HIRE a lawyer BEFORE you file for bankruptcy protection. The 2005 Bankruptcy Abuse Prevention Act that is now the law of the land lays many landmines for debtors. These landmines can blow up and cause the court to dismiss your case in such a way that you will never be able to file for protection from those listed debts again.

Find someone who is local to you to handle your case. The NY Bar Association (www.nysba.org) or the NYC Bar Association may be good sources of referrals for you.

THE INFORMATION PRESENTED HERE IS GENERAL IN NATURE AND IS NOT INTENDED, NOR SHOULD IT BE CONSTRUED, AS LEGAL ADVICE. THIS POSTING DOES NOT CREATE ANY ATTORNEY-CLIENT RELATIONSHIP BETWEEN US. FOR SPECIFIC ADVICE ABOUT YOUR PARTICULAR SITUATION, CONSULT YOUR ATTORNEY.

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Answered on 6/29/08, 10:03 pm


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