QUESTIONS? ASK A TRUSTEE.

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If you cannot find the answers to your questions on our FAQ page or elsewhere on our site you can click on the map at this link and ask any of the trustees your question.

If you would prefer, you can ask me your question by clicking on “Comments”, below and filling in the comments box. This service is confidential as your email address will NOT be displayed anywhere on your post.

Your question will be answered the same day.
Bookmark this page so you can check back for your answer!

IMPORTANT:
We can answer general bankruptcy questions. Specific questions probably cannot be answered because bankruptcy is complex and many questions cannot be answered without having full financial information. This is the purpose of the initial consultation with a trustee which takes approximately one hour.

A number of people have asked detailed questions on how to get around the fact that they lied on a credit applications or some other form of misrepresentation in order to get credit. We cannot answer these questions as it would not be proper. Trustees are officers of the court and cannot give advice on getting around the law.

Please don’t ask us questions if you already have a trustee. Your trustee knows all your financial information and can give you better answers than I can.

Please keep your questions down to one or two, at the most. If you have more questions than that you probably need an initial consultation with a trustee which takes approximately one hour.

Please do not ask for a legal opinion. If you want a legal opinion you will have to consult a lawyer.

Follow @BankruptcyCan

QUESTIONS? ASK A TRUSTEE.

WE HAVE STARTED A NEW THREAD HERE.

Follow @BankruptcyCan

If you cannot find the answers to your questions on our FAQ page or elsewhere on our site you can click on the map at this link and ask any of the trustees your question.

If you would prefer, you can ask me your question by clicking on “Comments”, below and filling in the comments box. This service is confidential as your email address will NOT be displayed anywhere on your post.

Your question will be answered the same day.
Bookmark this page so you can check back for your answer!

IMPORTANT:
We can answer general bankruptcy questions. Specific questions probably cannot be answered because bankruptcy is complex and many questions cannot be answered without having full financial information. This is the purpose of the initial consultation with a trustee which takes approximately one hour.

A number of people have asked detailed questions on how to get around the fact that they lied on a credit applications or some other form of misrepresentation in order to get credit. We cannot answer these questions as it would not be proper. Trustees are officers of the court and cannot give advice on getting around the law.

Please don’t ask us questions if you already have a trustee. Your trustee knows all your financial information and can give you better answers than I can.

Please keep your questions down to one or two, at the most. If you have more questions than that you probably need an initial consultation with a trustee which takes approximately one hour.

Please do not ask for a legal opinion. If you want a legal opinion you will have to consult a lawyer.

Follow @BankruptcyCan

We answer general personal bankruptcy and personal proposal questions on our Ask a Bankruptcy Trustee Blog. When we get a question that a number of people ask and/or a question we think will be of general interest we feature it on its own blog and give a more detailed explanation.

One of the questions we are frequently asked is how people can protect their assets from seizure in a bankruptcy; how a relative can be paid and not anyone else and other similar questions.

How to conduct yourself before filing bankruptcy or a proposal

Many people know they must file bankruptcy or a proposal but keep putting it off hoping for a change in circumstance or a miracle. If you find yourself in this situation it is important you conduct yourself properly concerning whom you pay and how you deal with your assets.

If you fail to do this you may put yourself in a position where you have your bankruptcy discharge postponed or denied and face severe fines by the court.

Many people ask how they can protect their assets from being seized and sold in a bankruptcy or if it is acceptable to pay a relative, for example, instead of a big credit card company.

The simple answer is you cannot protect assets from seizure or give preferred payments to relatives or anyone while on the verge of bankruptcy. Some people even consider “running up” their debt just before bankruptcy since it will be written off anyway. A word of advice: Don’t! Trustees in bankruptcy have extraordinary powers to recover preference payments and assets “sold” at below market value. Trustees in bankruptcy also have the duty to report such activities to the court where severe penalties are possible.

Some “don’ts”:
• Don’t make significant purchases on credit prior to bankruptcy or a proposal;
• Don’t make significant payments or payments to creditors out of the ordinary course of your payment history. Many people want to pay a relative, for example, ahead of a credit card company. Don’t do this. The law doesn’t distinguish between types of creditors and severe court penalties can be imposed;
• Don’t cash in RRSP’s or stocks on the eve of bankruptcy or a proposal;
• Don’t “sell” or transfer assets to a friend or family member;
• Don’t purposefully neglect to list some of your creditors. All debt must be listed.

Your attitude
The best way to look at an impending bankruptcy or proposal is that it is the law of the land and your right to get a fresh financial start by erasing most, if not all your debt while retaining certain assets specified by your province or territory of residence.

Accept this without guilt and without “beating yourself up”. At the same time don’t cheat. Play by the rules and your fresh financial start will come about smoothly, without stress and investigation and without guilt!

Filing Income Tax Returns in a Bankruptcy.

We answer general personal bankruptcy and personal proposal questions on our Ask a Bankruptcy Trustee Blog. When we get a question that a number of people ask and/or a question we think will be of general interest we feature it on its own blog and give a more detailed explanation.

QUESTION ASKED BY Marilyn:

April 22nd, 2006 at 4:54 am e
Does a bankrupt that has not been discharged( November 12/2004-present)
have a choice in were the 2005 income tax return is prepared ? The 2004 return was prepared by the trustee.The relationship has deteriorated and the bankrupt would like to have the return prepared by someone else.

Thank You

ANSWER:

April 22nd, 2006 at 10:55 am e
Marilyn: The trustee will not prepare any tax returns subsequent to the year of bankruptcy. It is the bankrupt’s responsibility to prepare these.

DETAILED ANSWER:

When a person goes into bankruptcy all his assets except the equity in assets exempted by the person’s province or territory of residence “vest in” or belong to the trustee. Income tax refunds, as at the date of bankruptcy, are assets that vest in the trustee. In addition, the trustee will ask the person to assign the post bankruptcy tax return (the tax return for the period from the date of bankruptcy to December 31st.) to the trustee for the benefit of the bankruptcy estate.
Note: If the post bankruptcy tax return does not result in a refund the bankrupt will be responsible for paying any income tax owing since the debt arose after the date of bankruptcy. The trustee may require the bankrupt to file this return if there is no refund available.

It is the duty of the bankrupt to provide the information to the trustee so the trustee can prepare the necessary tax returns.

The trustee is obligated under the Bankruptcy and Insolvency Act to file tax returns for the prior year’s tax returns (year prior to the year of bankruptcy) and the pre bankruptcy’s tax return (for the period January 1st. to the date of bankruptcy) regardless of there being a tax refund available.

Tax returns for the years following the year of the bankruptcy are the responsibility of the bankrupt to file.