When an individual or couple file for bankruptcy, they are required to
disclose all of their assets in their petition. It is important for filers
to remember that they must be 100 percent truthful when disclosing assets
and that they not attempt to hide them. Some people think that by concealing
assets, they won’t be taken away by the court during bankruptcy.
However, doing so is considered perjury, which comes with a number of
penalties which ultimately may end up costing the filer even more.
There are many reasons why an asset may go undisclosed by a filer. These include:
- The filer lied about possessing the asset
- The filer transferred an asset to someone else’s name
- The filer created fake mortgages or liens to devalue their property
- The filer may have been careless in disclosing the asset
- The filer may have legitimately forgotten to include assets they may not
have thought of
Bankruptcy trustees are very keen detectives and are not often fooled by hidden assets.
All it takes is a public records review, a debt review, a review of bank
records or tax returns, or a look at online asset searches to determine
whether or not an asset has been hidden or transferred. If a filer is
found to have attempted to conceal assets, they face a number of repercussions.
Not only will their hidden assets not be eligible for discharge (meaning
they will still owe the debt they were trying to get rid of with bankruptcy),
but they may also get their discharge revoked. Worse still, they may face
criminal charges and penalties for perjury, which is punishable by up
to five years in prison and / or a fine of up to $500,000.
Sometimes, though, assets are not disclosed simply because a person made
a mistake without malicious intent. If this happens, the filer should
immediately disclose the asset to their trustee. As long as the mistake
was not made in an attempt to delay, hinder, or defraud creditors, the
error should not result in a denial of a discharge.
The following are examples of assets most commonly forgotten in bankruptcy
- Retirement benefits
- Lottery winnings
- Co-owned assets
Considering Bankruptcy? Work With an Attorney
If you are considering bankruptcy in the Dallas – Fort Worth area, please
get in touch with a Dallas bankruptcy attorney at Allmand Law Firm, PLLC.
Our team is prepared to assist you with your filing so that you can reach
a resolution as quickly and smoothly as possible. Get started with a FREE
financial empowerment session when you