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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 2 other Bankruptcy Law Specialists are ready to help you

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