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C.Fortunato, Attorney
Category: Legal
Satisfied Customers: 8023
Experience:  Admitted NYS Bar, member ABA, NYSBA, NYCBA, QCBA, Licensed Real Estate Broker
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illiquid income producing membership interests in LLCs considered

Resolved Question:

illiquid income producing membership interests in LLC's considered property of the estate in chapter 7 filing. if there is a domestic support obligation is the illiquid income attachable for the domestic support?
Submitted: 5 years ago.
Category: Legal
Expert:  C.Fortunato replied 5 years ago.

Hi Drzman,

The asset membership itself would become part of the Bankruptcy estate. However, if by "illiquid" you mean unsaleable, the Bankruptcy trustee would "abandon" that asset, so that you would be able to keep it.

Income from a membership in an LLC cannot be garnished. However, once the income is received it can then be attached.


Customer: replied 5 years ago.
The income from a membership in an LLC can be attached for domestic support. Would the divorce attorney be able to attach the income post-petition?
Expert:  C.Fortunato replied 5 years ago.
Yes - as a Bankruptcy does not discharge domestic support obligations. Bankruptcy Stat. 523(a)(5).

Edited by cfortunato on 11/1/2010 at 12:10 PM EST
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