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Question: Can you transfer a DBA (non legal corporation name) when you are thinking about bankruptcy. We have a separate name that is really not on any legal docs as everything really goes under our retail DBA or corporate legal name. We may need to go bankrupt but trying not to lose the side of the business that actually does well. Everything still files back under the corporation though. I just want to try and keep the DBA either sell it to someone or transfer it.
Response: No. If you transfer the property to someone or sell it and then file for bankruptcy protection, the transfer would be considered a fraudulent transfer and attempt to hinder and delay and frustrate the claims of your creditors. The bankruptcy trustee is authorized to avoid the transfer to take the property back from the person you transferred it to. Pursuant to 11 U.S.C. Section 548 subsections (a) and (e) a bankruptcy trustee can void fraudulent transfers made within 2 years prior to bankruptcy filing and in some instances within 10 years prior to bankruptcy filing if transfer was made to a trust.
In addition, the Bankruptcy Trustee may object to your bankruptcy discharge because of substantial abuse pursuant to 11 U.S.C. Section 704(b)(2) and file a motion to have your bankruptcy case to be dismissed. You may be charged with bankruptcy crime for concealing your assets. See 18 U.S.C. Sections 152 and 157. Bankruptcy fraud carries a sentence of up to five years in prison, or a fine of up to $250,000, or both.