Avoid These Mistakes Before Filing for Bankruptcy

Posted on May 24 2017 - 6:05pm by Business Day TV

Bankrupt ConceptToo often people considering bankruptcy make costly mistakes before they get started on the process. The smartest move is to get yourself acquainted with bankruptcy law before you do anything, or engage a reliable Salt Lake City bankruptcy lawyer in guiding you through the process.

That said, here are some of the commonest mistakes people who want to file bankruptcy make.

Give Incomplete or Inaccurate Information

If you are working with an attorney, always make sure you provide all the required information about your assets, income, financial history, debts, and so on. Keep in mind that you are always under penalty of perjury while giving the information needed.

If authorities discover you to have knowingly misrepresented the facts, you risk criminal prosecution.

Failing to File Income Tax Returns

You will face an incredibly difficult time completing your bankruptcy unless you have first filed your tax returns for at least two years. Your petition will most likely suffer dismissal unless you can produce your tax returns for the IRS to assess your present and past earnings and assets properly.

Incur More Debt

Many people make the costly mistake of running up more debt a few months before filing bankruptcy. Any debt you incur 90 days before filing your case may lead to denial of a discharge of that debt in bankruptcy. If you intend to file bankruptcy, desist from taking out cash advances from your creditors.

Sell Assets

Selling your assets before you file bankruptcy can lead to a dismissal of your discharge. You may even face criminal charges unless you can demonstrate that you sold the property in an attempt to pay off your debts on your own.

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Anything you do before filing bankruptcy can significantly affect the success of your petition, so be careful in the steps you take. Keep everything you do transparent, especially your financial transactions since they are very sensitive to the process.