Deck 31 Flashcards
What chapters of bankruptcy may be voluntary or involuntary?
Chapter 7 or 11 (Ch. 13 is voluntary only)
What chapter of bankruptcy is voluntary only?
ch. 13
Under voluntary cases, who files?
The debtor files; automatic order for relief
Under involuntary cases, who files?
Unsecured creditor; does not constitute an order for relief
Who may petition a debtor involuntarily into bankruptcy? (Kind of creditor and amount)
Unsecured, undisputed debt; Creditors must owe at least $15,325
Power of fraudulent transfer
Trustee can set aside set aside fraudulent transfers made within 2 years of the filing date
Preferential payment in Bankruptcy is (purpose to prevent one creditor being preferred over other):
1) Transfer made to or for the benefit of a creditor; 2) on account for an antecedent debt; 3) made within 90 days of filing the petition; 4) creditor receives more than the creditor would have received under the bankruptcy code
Something not considered a preference
Payment to a fully secured creditor
What debts will not be discharged by a bankruptcy? (WAFTED)
Willful and malicious injury, Alimony, Fraud, Taxes, Educational Loans, and Debts undisclosed
Assets of an estate are distributed in the following order:
1) secured creditors; 2) priority creditors; and 3) general creditors who filed on time
Taxes that can be claimed as itemized deductions include:
Real estate tax, income tax, and personal property tax (ad valorem tax on car)
Education loan interest is what kind of adjustment?
Adjustment for AGI limited to $2500
Treatment for Municipal bond income
Not included in gross income
Statute of limitations for fraud or filing false tax returns
No limitation
Rights that a surety has against the principal debtor
Exoneration, subrogation (step into the shoes of the debtor), and reimbursement
Defenses of a Surety (CPRS)
Creditor acts in bad faith; payment and tender of payment; release of principal debtor; and surety’s incapacity or bankruptcy
No defense situations for a surety
Principal’s fraud or duress upon surety; incapacity of principal; and bankruptcy of principal
Creditors’ composition
Agreement between the debtor and at least 2 creditors that the debtor pays the creditors less than their full claims in full satisfaction of their claims
Judicial lien
Property in the hands of the debtor
Garnishment
Property in the hands of a third party
