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cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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I own a retail store, and may be forced to file for bankruptcy

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I own a retail store, and may be forced to file for bankruptcy very soon. I have a customer that wants to place a large order that I will have to prepay the manufacture for. My wifes parents will loan me the money, and I would pay them back in full (no interest) as soon as the customer makes the payment. My question is, if I file for CH. 7 will that payment I made to them have to be reported as an insider? This sale would help me out, and may even allow me to avoid BK, but if there's even a slight chance they could get sued for the payment, I can risk it.
Hi - my name is XXXXX XXXXX I'm a Bankruptcy attorney here to assist you.

The answer is "yes" - pursuant to Bankruptcy Code section 547(b), if you file a Bankruptcy less than one year after paying back your wife's parents, that payment can be deemed a "preference", and the Bankruptcy trustee would be able to take that money from your wife's parents. (However, if you waited at least one year after the payment to file a Bankruptcy, then your wife's parents would be able to keep the money.)

I think this is what you wanted to know. If not, please let me know. Thank you.
Customer: replied 4 years ago.
Yes, thanks! I wish there was someway to specify which attorney to direct a question to. That was very clear:)
You surely can direct a question to any attorney (or other expert) that you want to. Simply start your question with the name of the attorney.
Eg. "Dear cfortunato", or "For cfortunato", etc.
cfortunato and other Bankruptcy Law Specialists are ready to help you

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