What Counts As Assets in a Bankruptcy Filing?

You must declare every asset you own if you file bankruptcy.
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Most assets you own or are entitled to receive at the time you file bankruptcy are considered assets in a bankruptcy filing. Your assets are protected from liquidation in a Chapter 13 bankruptcy, but if you file Chapter 7, your assets may be fair game for your creditors. However, all states allow you to protect at least some of your assets. When you file, the court requires you to segregate your assets by type on bankruptcy schedules.

Real Property

Real property for bankruptcy purposes is what most people refer to as "real estate." You must list any property in which you have a legal interest. On Bankruptcy Schedule A, you must list the description and location of the property, the nature of your interest in the property, the current value of your interest in the property, the amount of secured interest a lender has in the property and whether you own it solely, jointly or have a community interest in the property.

Personal Property

Personal property is all the non-property "stuff" you own, and all of it is considered as an asset in bankruptcy. You have to list your property on Schedule B when you file your bankruptcy petition, which is divided into 35 distinct categories of personal property. For each category, you'll have to list the description and location of the asset, your ownership interest in it and the current value. Sample property categories include cash on hand, checking and banking accounts, household goods and furnishings, automobiles, furs and jewelry, firearms, books and collectibles, securities accounts, boats, aircraft, machinery, inventory, animals and "other."

Exempt Assets

To protect assets from liquidation in a Chapter 7 bankruptcy, you must exempt them using the bankruptcy protection laws in your state. To property exempt assets, you must describe them on Schedule C, along with the value of the assets, the value of the exemption and the law providing the exemption. If you cannot exempt an asset, it is known as a non-exempt asset and your bankruptcy trustee may seize it on behalf of your creditors.

Assets You Are Entitled to Receive

If you are entitled to receive an asset at the time you file bankruptcy, it is part of your bankruptcy estate even if you don't yet have physical possession of the asset. Examples include royalties from a book you published before you filed bankruptcy, property you have loaned someone or security deposits you have given to a landlord. Certain assets you acquire or become entitled to receive within 180 days after you file bankruptcy are also considered assets of your bankruptcy, including life insurance proceeds, property you receive from a divorce settlement and inheritances.

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