Florida Homestead Exemption Not Affected By Commercial Operation on Land

May 22, 2020 / Bankruptcy, Homestead Exemption

Technology has made it easier for people to operate a business at or next to their primary residence. Operating a commercial venture on the property where you reside raises issues about Florida’s homestead exemption from creditors. The issue is whether a Florida resident can operate a commercial business on his homestead property without forfeiting homestead …

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Bankruptcy Debtor Denied Exemption For Self-Directed IRA

May 22, 2020 / Bankruptcy

A self-directed IRA is a personal IRA plan where the owner can invest IRA funds in assets other than marketable securities, such as real estate. There are companies that provide qualifying IRA plan documentation and who hold title to your customized IRA assets. The self-directed plan provisions require that the owner not use IRA money …

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Non-Debtor Spouse May Be Liable For Fraudulent Transfer To Entireties Account

May 22, 2020 / Bankruptcy, Fraudulent Transfers

I’ve warned many clients against making fraudulent transfers of money to their non-debtor spouse or to tenants by entireties with their spouse. A creditor may get a general money judgment against the non-debtor spouse for the value of assets transferred. The transfer to the spouse risks making the spouse a new defendant in the creditor’s …

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Income Tax Liability In Bankruptcy For Appreciated Property

May 22, 2020 / Bankruptcy

People avoid filing Chapter 7 bankruptcy if they have non-exempt property with significant equity. Yet, consider a debtor who owns real estate that has appreciated and therefore has a built in liability for capital gain. If that debtor files bankruptcy could the IRS hold him personal liable after bankruptcy for the income tax liability associated …

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Are Fraudulent Transfer Debts Dischargeable In Bankruptcy?

July 27, 2020 / Bankruptcy, Fraudulent Transfers

A bankruptcy debtor cannot discharge debts incurred by false representation or actual fraud. Appellate court decisions split as to whether a debt incurred as part of a fraudulent transfer of assets is included in the category of “actual fraud” that may not be discharged in bankruptcy. Some courts have held that actual fraud in the …

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Bankruptcy Court Says No Claims Permitted For Conspiracy or Aiding And Abetting Fraudulent Transfers

May 22, 2020 / Bankruptcy, Fraudulent Transfers

A recent bankruptcy court decision addressed the issue of whether people who assist a debtor’s pre-bankruptcy fraudulent transfers can be held liable for damages in the bankruptcy proceeding. In this case, a trustee hired to liquidate debtor property filed a complaint pursuant to Section 544(b) of the Bankruptcy Code against a group of people for …

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Protection of Partnership or LLC Interest in Bankruptcy

May 22, 2020 / Bankruptcy, LLC

Family partnership and limited liability companies provide asset protection in state court collection proceedings because creditor’s collection tools are limited by Florida statute to a charging lien on distributions. Less clear is how a debtor’s partnership interest or LLC interest would be treated if the debtor filed bankruptcy. The bankruptcy trustee is not necessarily limited …

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