Major item sale

[B12]

I just saw a post about a car being sold.

Got me to thinking. I sold my daughter my house a little over a year ago, for full market value. She bought it as an investment and does have other investment properties, so it's not like she bought it to help me.

Anyway, is that a problem because it is a relative and why?

[keepmine]

It's a problem because on the surface, dealings with relatives close to a bk filing gives rise to issues like preferential treatment and fraudulent conveyance.
You'll need to disclose property transfers within 2 years of filing. Were I you, I'd sure give my attorney a headsup and start gathering documentation showing the sale was at FMV.

[B12]

Was definitely at fair market value. Did plan on telling attorney. If at fair market value, does that alleviate the problem?

I also gifted one of the kids 25,000 of the proceeds but was solvent at the time. Need to see what attorney says. I used the rest which was quite a bit of money to live on for the year while the business was not producing income. I have banking statements showing the deposit and expenses.

Didn't plan on a BK at the time. Are they looking for fraud? Is it up to them to prove fraud since I was solvent at the time?

This might be a major problem I didn't foresee.
btw, It was a little over a year ago, and I wasn't even thinking BK.

[ssdsco]

I have a similar situation. My attorney said that as long as your assets, not including any that will be exempt in BK, exceed your debts your solvent and the gift would not be considered a fraudulent conveyance. There's only a one year look back on the BK7 filing for gifts but trustees can go back 5 years if they start smelling smoke in your filing.

I'm sure you'll need good doc on the home sale at FMV. That's a 2 year look back and you'll need to show it.

At least that's my understanding.

[B12]

If you were solvent when the gift was made?

I have been just reading about fraudulent transfers. Looks like they consider it fraudulent if made within TWO years. Oh my.

There is some info about unintentional transfers with no wrong doings and it seems that the court does not even look kindly on them.

I have second lawyer appt next week. We will see.

Fair market value is definitely not going to be an issue. I realized 4 times the amount of the gift and have documentation that I paid outstanding debt with it.

[HHM]

If you received market value for the property, then there should not be an issue with fraudulent transfer regardless if the you made the transfer to an insider.

As for the look back...for real estate, the look-back can be up to 10 years, (but only in limited circumstances)