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Bankruptcy Assets: Accounts Receivables and Commissions

    Bankruptcy AssetsLiquidation

    Accounts receivables and commissions not already received are considered assets in bankruptcy.  This means that people who are interested in filing for bankruptcy should contact an attorney to determine whether the assets can be exempted (or saved) from liquidation during the bankruptcy.

    Bankruptcy Exemptions in California

    If assets cannot be exempted, the bankruptcy trustee and court can sell those assets to pay off your debt.  If those assets can pay off 100 percent of your debt, then any remaining equity will go back to you.

    There are a number of exemptions that can be used to save assets in bankruptcy.  In California, there are two types of exemption systems.  These can be found under California Code of Civil Procedures Sections 703 and 704.  All people interested in filing bankruptcy should thoroughly review these sections to determine what is right for them.  This could be the difference between saving or losing a home, car, commissions or accounts receivables.

    Timing of Bankruptcy

    Timing of your bankruptcy filing will also make a difference in determining whether something will be considered an asset or not.  If you already received and spent the commission, then it is no longer an asset.  However, the item that you purchased would be considered an asset.

    As you can see, there are many variables.  An experienced attorney will help you determine what is best for you.  Potential bankruptcy clients, should not move, transfer, buy or sell assets and property without first consulting an attorney.