gift to relative before bankruptcy

June 21st, 2013 by Questions

I recently read one of your responses that dealt with gifts to family members prior to bankruptcy and I recall your comment about the gift, I think it was $25,000, being given more than 5 years before the bankruptcy so no problem. What if the gift was real estate worth $100,000 or more and say 9-10 months ago to a spouse or child or parent? How does that impact the bankrupt individual.

Posted from: Ontario

Questions

One Response to “gift to relative before bankruptcy”



June 21, 2013 at 2:09 am, A licensed trustee said:

It is called a transfer under fair value and it can land you and the people you transferred the property to in a lot of trouble. Any transfer of this type in the 5 years before you file for bankruptcy can be reviewed and potentially overturned/reversed when dealing with related parties. (The period for non-related parties is only 12 months). You will want to discuss this with your trustee before you file – depending on what your trustee tells you, you may also want to consult with a lawyer and/or warn the other people involved.

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