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The Importance of Pre-Bankruptcy Planning


In completing a bankruptcy, one can look forward to a new start, a clean slate—all thanks to this method of financial planning and reorganizing. There are some consequences that come along with filing bankruptcy too, from how it affects your credit to the loss of non-exempt property and more, but the upside is that you are facing your financial mistakes and issues, and starting over responsibly and legally.


The bankruptcy process is a methodical one.  To see that it runs as smoothly as possible, be sure to engage in any pre-planning far ahead of time. Because you want to act in good faith before your bankruptcy, it’s obviously not a good idea to begin moving money and non-exempt assets around right before you file so that it can’t be given or sold off to pay creditors. It’s important to arrive to the bankruptcy court with accurate and honest information that will help you achieve your discharge as seamlessly as possible. Everything you do in the pre-planning process should be on the up and up—as you do not want to be accused of fraud.


Debt and financial stress does not come about in a day, and deciding to file for bankruptcy most likely will not either. If you decided to go forward with bankruptcy, be sure to have all required tax returns ready at the time of your bankruptcy filing. While dealing with taxes may seem like a most unpleasant tax, having this information complete and available is usually imperative as without it, your bankruptcy can’t proceed. Most likely your returns will be needed to assess your income and examine whether you are eligible for bankruptcy.


It is also very important to consider your budget before you head into bankruptcy. Any money that would previously have gone to creditors for items like credit card debts or medical bills may be better spent on items that are exempt and won’t be discharged in your bankruptcy. This is also a crucial time to look at your current finances and try to discern whether a Chapter 13 would work for you with monthly payments, or whether you would be better off with a Chapter 7 bankruptcy. A law firm like Fitzgerald & Campbell with attorneys experienced in bankruptcy will be able to help you explore all your options along with deciding which chapter is best for you.


Begin reviewing your assets and figuring out which are probably exempt or non-exempt. Before you decide for sure to file for bankruptcy, it’s important to take a hard look at what you will be able to keep, and what you may not. Keep in mind that all exemption planning performed ahead of time must be done in good faith.


It’s important to make sure you time your bankruptcy correctly, discussing this with your attorney. Different factors can affect this. Will you be moving soon? Will your income be changing soon, affecting your means test? Are you hoping to stave off a foreclosure that is imminent? You may want to push your bankruptcy up soon, or delay it, depending on what is currently going on in your life.

Bankruptcy be a very effective way to reorganize your finances and see many debts discharged.  Contact us at Fitzgerald & Campbell, APLC where an experienced bankruptcy attorney can review your case and then explain your options, helping you navigate through the process. Call us today for a free consultation at (844) 431-3851, or email us at

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