Protecting or "hiding" assets

[justvisiting]

QUESTIONS:

1) I know of several cases where a couple has considerable assets (specifically an expensive home) and the home has been put in the wife's name only.

This may have been in anticipation of a lawsuit or maybe just "in case" creditors try to come after them.

My question - isn't THAT "asset hiding" and also illegal? Seems to be a relatively common practice.

2) What about proceeds from a legal settlement? Are they exempt? For example I know someone who received some annuities (payable at future dates) as settlement for a personal injury lawsuit. This was several years ago. He was told legal settlements are tax-exempt. But if he files bankruptcy do these have to be revealed and can creditors come after those annuities?

 

[HomeGuru]

QUESTIONS:

1) I know of several cases where a couple has considerable assets (specifically an expensive home) and the home has been put in the wife's name only.

This may have been in anticipation of a lawsuit or maybe just "in case" creditors try to come after them.

My question - isn't THAT "asset hiding" and also illegal? Seems to be a relatively common practice.

**A: it could be depending upon the specifc circumstances.
In some cases the court would rule a faudulent transfer and in others, the transfer remains intact.
**************

2) What about proceeds from a legal settlement? Are they exempt? For example I know someone who received some annuities (payable at future dates) as settlement for a personal injury lawsuit. This was several years ago. He was told legal settlements are tax-exempt. But if he files bankruptcy do these have to be revealed and can creditors come after those annuities?

**A: not all legal settlements are tax exempt and ALL income must be noted on the BK petition schedules.

 

[justvisiting]

HG, thanks for reply.

In the case about annuities from legal settlement, it's my understanding that he do not receive income, but that he has a couple annuities which will be payable in something like 8 years and another one in 15 years (but I have not seen the papers). But he is not receiving any income from them at the present time.