How an inheritance will affect your bankruptcy depends on: 1) timing; 2) your Chapter filing; and 3) the amount and nature of the inheritance.
In Chapter 7 liquidation cases there is a 180 day rule. If you are to receive an inheritance from a decedent who died within 180 days prior to the date of filing, or from someone who dies within 180 days after the date of filing, you must report the circumstances to the trustee. In all likelihood your inheritance will become part of your bankruptcy estate. If the decedent died more than 180 days prior to the date of filing, or dies more than 180 days after the date of filing, the inheritance is yours. Continue reading