If you are going to declare bankruptcy, you must know it: the right process will not be utilised unless all assets are considered. If you hide any of your assets, you are likely to face some serious consequences.
When you find that it is impossible for you to pay off your debts, declaring bankruptcy can be your last resort. However, the procedure requires you to be honest about the assets you have in your possession. If you conceal your income and lie to the authorities, you will have to face consequences for years.
A person filing bankruptcy can hide assets in a number of ways. The most common way is to transfer the assets to another person. Some people sell off property and reclaim it later. If you hide your assets, you may need to deal with severe penalties. You may even lose your eligibility to apply for bankruptcy in the future. The authorities can ensure that the appropriate process has been used only if you mention all your assets in the application.
How it works
You are required to file the correct chapter based on your income, revenue and other assets. If you have hidden some of your income, you may not need to apply for bankruptcy in the first place. That income may make you ineligible for bankruptcy.
If you are filing for wiping out most of your debts but you earn enough to pay for some of the debts, the procedure will not be correct.
If you have unrevealed assets, there is a great chance that people who work for bankruptcy will reveal those assets by conducting a thorough research. The agents will reveal your concealed assets and disqualify you. You will be rejected because of your hidden assets. You may also need to face criminal charges and other penalties. Every year, many people are fined and jailed for concealing assets when applying for bankruptcy.
The trustee who is appointed to review your case is supposed to be skilled enough to discover hidden assets. Your trustee can find irregularities by reviewing your debts, searching your public record, searching online assets, and examining your tax returns and bank records.
Mistakes in applications
Many applicants make mistakes in paperwork. Some persons make mistakes when filling out certain fields, partly because they get overwhelmed with so many papers and forms.
When declaring bankruptcy, you should hire a professional to help you file for bankruptcy to make sure that the documents stating your claim are accurate and provide you with the best outcome. You do not want to accidentally deceive the authorities and by hiring a professional you will ensure everything is done properly. The officials of the bankruptcy department will understand what you mean. Some assets are easier to forget than others. But in such a case, you may need to start over and adjust things so that they match the new information you have provided.
Some assets that people tend to forget more often include lawsuits or potential lawsuits, annuities, retirement benefits, beneficial interests, lottery winnings and co-owned assets.
It is a good idea to disclose the asset as soon as you realise that you have made a mistake. If the court is convinced that you did not intend to deceive, your discharge will not be revoked. The mistake will be regarded simply as a mistake. But you may still have to face some problems.
The officials may issue penalties if they discover data that you hid intentionally. You may not be eligible for discharge in that case. They may even reject your application. Facing criminal charges for perjury is a common consequence.
You can prevent such disasters if you hire a lawyer who can assist you with the procedure. Bankruptcy lawyers can help you complete the procedure smoothly.