What Happens if I Receive an Inheritance During my Bankruptcy?

If you happen to receive an inheritance during a bankruptcy, your course of action will likely depend on which chapter you filed for. If you filed under chapter 7 whatever happens to your inheritance depends on when you actually inherit the money. If you inherit it before filing you will have to include the inheritance in the bankruptcy estate and use some of your exemptions to try and keep some of that money. If you receive an inheritance within 180 days of filing for bankruptcy then amendments will need to be made to your petition in order to exempt your inheritance. Finally, if you receive an inheritance more than 180 days after filing the inheritance will not need to be incorporated into your bankruptcy estate. If you filed for chapter 13 in most cases you would need to make an amendment to your petition so that you can exempt that money, but if you are in a 36 month plan and you’ve made payments for 36 months you are entitled to receive your inheritance without it being incorporated into the bankruptcy estate.

To better understand if filing for bankruptcy is the right option for you, it would be to your advantage to set up a consultation with a local bankruptcy attorney.