San Fernando Valley Asset Protection Attorneys
How to Protect Your Assets
Many people are reluctant to consider bankruptcy because they fear losing everything they’ve worked so hard for to creditors. Fortunately, there are laws in place that limit what creditors can take from you. Also, there are certain steps you can take before a bankruptcy to protect your assets for your own use, or to hand them down to your children. But bankruptcy law has many gray areas and can be difficult to navigate. To make sure you’re not breaking any laws, it is vital that you consult an experienced asset protection attorney. The legal team at the San Fernando Valley offices of Nader Law Firm has been successfully representing Southern California clients for over 20 years and will put their experience to work on your case. Call (800) 568-0707 for a free consultation.
There are limits to what a creditor can hold you responsible for in a bankruptcy, and these vary by state. In California, the following are exempt up to a certain value. Since these amounts change fairly often, consult your attorney about the current values.
- The principal residence you reside in at the time of your bankruptcy filing.
- A working vehicle (not a luxury vehicle).
- Household items and personal items (cookware, clothing, etc.).
- Burial plots.
- Retirement benefits.
- Social Security payments.
- Personal injury and wrongful death settlements.
- Tools of a trade.
- Pensions and retirement benefits.
- Jewelry and heirlooms.
- Health aids.
For more detail about what is exempted from bankruptcy, consult an experienced San Fernando Valley bankruptcy attorney.
Another way an attorney can help you protect your assets is by creating a separate entity that is exempt from creditors. This could be in the form of a Trust, a Limited Partnership (LP), a Limited Liability Corporation (LLC), an S Corporation, or a C Corporation. An attorney can draw up the paperwork to make your new classification official.
Another way to protect your assets is by converting your nonexempt assets into exempt assets before you file for bankruptcy. For instance, if you have more money in the bank than the state allows you to keep, you could use the money to buy exempt items like clothes or food for you and your family. In some cases, you may be able to put some of your money in an exempt account like an IRA or 401k. But you’ll need to be careful because there’s a fine line between converting nonexempt assets to exempt assets and bankruptcy fraud. If the conversion is made within a year before filing, a creditor can challenge the action. For this reason, it’s important that you speak with an experienced bankruptcy attorney before attempting to convert assets.
Bankruptcy can be a good way to get out of debt and make a fresh start, but you don’t want to make the new chapter in your life more difficult than it has to be. Contact the attorneys at the Encino offices of Nader Law Firm for a free case evaluation at (800) 568-0707.
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