Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
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How much money would go into the accounts, also how long will they wait to file?
Under the bankruptcy code a debtor can put non exempt assets into exempt assets and not have to turn the assets over to a trustee.
As long as it is not a fruadulant transfer or a gift, the transfer to the 529 plan if it is exempt under your State laws, would be protected.
According to Bankruptcy Court interpretation on what is a fruadulant transfer the Court stated the trustee much establish each of the following elements: 1) that an interest of the debtor in property was transferred; 2) that the transfer of that interest occurred within one year before the date of filing of the bankruptcy petition; 3) that the debtor received less than "reasonably equivalent value" in exchange for the transfer at issue; 4) that the debtor was insolvent on the date of the transfer or became insolvent because of the transfer.
In this case I do not see an issue
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