Inheriting money can be a lifeline when you're used to struggling to pay your bills, but if you're in the middle of a Chapter 13 bankruptcy proceeding, a windfall could impact your bankruptcy case.

Let Your Bankruptcy Attorney Know Right Away

If you inherit money while you're in Chapter 13 bankruptcy, you must notify your bankruptcy attorney immediately. Navigating the complexities of inheriting money during Chapter 13 bankruptcy can be challenging. Your bankruptcy attorney can review the details of your case, advise you on your rights and obligations regarding the inheritance, and help you understand the potential implications for your bankruptcy proceedings. They can also represent your interests in discussions with your trustee and ensure that your rights are protected throughout the process.

With your attorney's help, you will also want to notify your bankruptcy trustee. This is not something to put off or take lightly. Failure to disclose an inheritance could have serious consequences, including dismissal of your bankruptcy case or even allegations of bankruptcy fraud.

Inheritances are considered assets and may be subject to inclusion in your bankruptcy estate, depending on the timing of the inheritance and the provisions of your repayment plan. Your trustee will assess the value of the inheritance and determine whether it affects your repayment obligations or requires adjustments to your bankruptcy plan.

Modifying Your Bankruptcy Plan

Depending on the size and timing of the inheritance, it may be necessary to modify your Chapter 13 bankruptcy plan to accommodate the additional funds. Your trustee and bankruptcy attorney can work together to determine the best course of action, which may involve adjusting your repayment schedule, increasing your monthly payments, or even converting your Chapter 13 case to a Chapter 7 bankruptcy, depending on your circumstances.

Openness and Compliance are Essential

While you're sorting through the impact of your inheritance on your Chapter 13 bankruptcy, it's crucial that you maintain transparency and compliance with all court orders and trustee requests. By remaining open and cooperative with your trustee and bankruptcy attorney, you can ensure that the inheritance is properly accounted for and that your bankruptcy case proceeds smoothly.

Inheriting money during Chapter 13 bankruptcy can present unique challenges, but with careful planning and guidance from experienced legal professionals, you can navigate this situation effectively. If you have questions or concerns about inheriting money during Chapter 13 bankruptcy, please call The Craig Black Law Firm at (678) 888-1778 or contact us online.