Assets Assets Assets!

Assets.

First let’s look at the definition of asset, which is an item of value that is owned by a person, company, etc.

Now let us look at how the definition changes when it is involved with a bankruptcy. It is still an item of value owned by a person, company, etc. but is now something that will be liquidated to pay off creditors before all the debts are wiped clean.

It is now time to look at why assets are so important in a bankruptcy. In order to get a discharge you must be honest and open when it is time to list everything on your bankruptcy papers, from assets and all of your debts. And again, this is because if you do have assets that can be liquidated and dispersed amongst your creditors then the Trustee needs to know this.

There are bigger problems than not getting a discharge when you don’t disclose your assets in a bankruptcy. You will have to turn over the property by law, so the Trustee can sell them and pay creditors. If your Trustee finds the assets after the fact of being granted a discharge, the Trustee then can ask the court to revoke your discharge. This can happen even after one year after the date your debts were discharged. Also if you do not disclose assets then any debts that were listed in your bankruptcy when  your discharge was denied or even revoked will still be owed.

Last but not least and certainly worse, is you could be criminally charged for not disclosing assets. (see section 11 USC 512)  When you sign your bankruptcy schedules listing your assets under penalty of perjury this is a serious matter. When stating that those papers are true and accurate, the penalty for making a false statement or concealing property (assets) is a fine of up to $500,000 or imprisonment for up to five years, or both.

With this being said, think twice before you decide to not disclose/hide assets when filing for a bankruptcy.  

This is not intended as legal advice, if seeking legal advice please consult your legal advisor.