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List your stuff at fair value or lose your bankruptcy discharge

By David Leibowitz, Illinois and Wisconsin Bankruptcy

When you file a bankruptcy case, you need to list all your stuff.

That means all your stuff.

That means at fair market value.

That means don’t mess around.  In particular, don’t mess around with the Bankruptcy Court in Texas.

In a recent case, In re Peters, the debtor listed “Art” consisting of “six pictures” worth $500.  This was a great big fib.  The stuff included lithographs, serigraphs and other work appraised at close to $25,000.  What was even worse, the debtor had recently tried to sell one of the works for close to $5,000.

The court found that this wasn’t even a close call.  The debtor did more than fib. The debtor did more than incorrectly estimate the value of his stuff.  He out and out lied.

It’s not nice to lie to the bankruptcy court. In fact, it’s reason to bar your discharge under section 727 0f the bankruptcy code.  In fact, it’s enough to send you to jail for up to 5 years under 18 USC section 152.

So tell your bankruptcy lawyer the truth, the whole truth and nothing but the truth.  Don’t hide assets, and don’t mess with the Bankruptcy Court – whether in Texas or anywhere else.

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Full post as published by Bankruptcy Law Network on January 05, 2011 (boomark / email).