It really does not happen very often, but sometimes any person who wants to file for the bankruptcy is also in the line for receiving an inheritance. Like many things, what is going to happen to that inheritance in the case of bankruptcy is also depends on the situation and time.
When anyone files for the bankruptcy, all the assets and other forms what we call the bankruptcy estate that is similar to the probate estate. This is the way of defining the class of the things that the chapter seven trustees will sell if there are no exemptions or the chapter thirteen trustees can count to determine the fairness and clarity of the payment plan. This then deals with the effect of the financial inheritance according to the Chapter 7, because the options in Chapter 13 are very different, and also involves simple dismissing the case.
The bankruptcy estate involves the property which the applicant own and are entitled at the time of the bankruptcy and when the petition is filed, by only some of the exceptions.
So, just take an example to explain this. First, say that any person is planning to file for the bankruptcy, he also has prepared all the required and essential paperwork and also scheduled to come in and sign the petition, when he find out that his grandfather who he thought that he disapproved him, has left an annuity for him. The person has not yet filed for the bankruptcy, so the first thing that he should do is to call the bankruptcy lawyer. The bankruptcy lawyer will then go for the various available options, which usually depend basically on how much the applicant will stand to get. If the mentioned amount that he stands for receiving is too large, then he may be in the position of paying to the creditors, or at least he can negotiate the settlements with them. If the required amount is correct, then he will be capable of protecting the inheritance, and also can easily continue with the legal process of the bankruptcy plans. The one very essential takeaway in this process is that the applicant must discuss this with his lawyer. The applicant can be tempted not to discuss it, but that is considered as the bankruptcy fraud, and the inheritance will not do you any good while the applicant is in a federal penitentiary.
So dealing with the bankruptcy in the case of inheritance requires a lot of efforts. Bankruptcy is a delicate issue that always needs to be handled with great care. For understanding the various financial matters and process of bankruptcy, the applicant first can go for different short term courses. Bankruptcy course, bankruptcy pre-discharge course, credit counseling course and debtor education course are the courses that one can choose for the proper understanding of the financial management and the bankruptcy process. Bankruptcy course is a short term course that can also be done online with ease.