Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
Were those assets listed anywhere else on the petition?
Is his partnership percentage the asset you said was in his Revocable Living Trust?
If so, was this partnership percentage listed on Schedule B?
Since that asset was listed on Schedule B, there would be no repercussions for your husband based on the fact that the asset was not also listed on the SOFA line10b. Almost all Bankruptcy petitions have some errors, and few are actually fatal to the case.
The reason for Section 10 (a & b) on the SOFA is to discover fraudulent transfers, that might not otherwise be listed on the Bankruptcy petition. Although your husband was supposed to list that asset in Section 10b - if transferred to a self-settled debtor-beneficiary trust within 10 years before the Bankruptcy filing - there was no harm done for not listing it there, since it was listed on Schedule B, and there would therefore be no legal ramifications involved for not having listed it there.
That it the whole point - you do know what was transferred into the RLT, because it was listed on Schedule B. If the RLT had not been listed on Schedule B or on the SOFA, there could have been significant legal ramifications if and when the Bankruptcy found out about the omission.
The Revocable Living Trust was not listed anywhere on the schedules. The LLC's that were part of the Revocable Living Trust were listed on schedule B. The fact that they were part of a Revocable Living Trust was omitted.
If all assets that were transferred into a self-settled trust within the 10 years before filing the Bankruptcy are listed elsewhere on the Bankruptcy petition, it doesn't matter that those assets that were listed elsewhere were not also listed on the SOFA.
The Trustee does not have to know that there is a self-settled trust, as long as all the assets in that trust are listed elsewhere in the petition. If the Trustee is interested in any of these assets, he will inquire further to find out all the details.
Having assets in a self-settled trust - whether revocable or not - does not make those assets more or less likely than a non-self-settled trust to be taken by the Bankruptcy Trustee.
Bringing the omission on the SOFA to the Trustee's attention would not have made a difference to the Bankruptcy proceeding. I don't know about divorce proceedings. Perhaps you could direct the second question to the "Family Law" section.
DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.
The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).