Q: Is my LLC and its assets protected by the Automatic Stay in my Chapter 7 bankruptcy?
1. Filed case February 7, 2013 (02/07/2013)
2. Received Discharge May 18, 2013
3. Case is an Open Asset case (as of today – Trustee is suing previous employer for past wages of almost $125,000)
4. Approximately May 26, 2014 – Bankruptcy Court granted a Relief of Automatic Stay on our residence.
5. Approximately May 28, 2014 – the title of the house was transferred from my spouse to a company we owned, which is a Nevada LLC -no other assets exist in the LLC.
6. At the time title in our house was transferred to the Nevada LLC, the LLC was in Revoked Status as of May 2013 due to lack of paying Nevada State license fees (I thought it was in good standing - my mistake)
7. The Nevada LLC was created in May 2011 and 50% is owned by me, individually and 50% by my spouse, Individually.
8. 50% of the Nevada LLC is part of my Bankruptcy Estate, which was an asset of mine at the time I filed bankruptcy. The case is still an Open Asset Case and has not been given Relief of Automatic Stay.
A:
You have quite a few problems with those facts. I am not licensed in California, but if some of the things that you and your wife did in my state, then you have created more problems than you would have had you not made the transfers. If you convey your homestead and put it in an LLC, then the ownership interest the LLC is not exempt while you would have been able to exempt the homestead up to $75,000.00 if it were still owned by you and your wife.
There is a federal exemption that allows you to exempt 75% of you wages. If you failed to claim that exemption, it may be too late to amend and claim it now, but that would be worth a try.
If you do not have an attorney, then you need to contact an experienced bankruptcy attorney that is willing to handle litigation in bankruptcy cases. Most attorneys will provide you with a free consultation to review your situation and determine if he/she can help you.
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.
