Las Vegas Lawyers for Pre-Bankruptcy Planning and Preparation
Filing for bankruptcy is an effective and affordable way to deal with overwhelming debt and financial stress for many people and businesses, but rushing out and filing a petition just to get immediate relief isn’t always the best approach. Thoughtful planning and careful preparation before you file makes all the difference in how effective your bankruptcy will be.
At Larson & Zirzow, our Las Vegas bankruptcy lawyers take pre-bankruptcy planning seriously. We know that each client’s financial situation is unique, and so are the risks and opportunities that come with filing for bankruptcy. Whether you’re an individual considering Chapter 7 or Chapter 13, or a business owner needing to restructure under Subchapter V or Chapter 11, the decisions you make in the weeks and months before you file can protect property and preserve value, or can create unnecessary complications.
Bankruptcy is a complex process and not something to handle without a lawyer. With our help, you can prepare properly, avoid costly mistakes that may cause you to lose property or jeopardize your discharge, and take advantage of every legal tool available to protect what matters most.
Why Planning Matters
Bankruptcy law provides powerful protection and relief for individuals and businesses. But the law also examines certain financial transactions and other activities in the period leading up to your filing. Actions like transfers of money or property, large payments to family members or friends, or sudden rearrangement of asset and financial affairs can trigger heightened scrutiny of your case from the bankruptcy trustee and creditors.
The result? If you act without proper guidance, you could put your discharge at risk or lose property that could have otherwise bene protected. Good pre-bankruptcy planning looks at the big picture, helps you understand your assets, income, and debts, and creates a clear strategy to avoid problems later. Here are some key factors to watch out for when planning to file for bankruptcy.
Asset Transfers and Paying Off Loans
One of the biggest mistakes people make before filing for bankruptcy is trying to handle debts or assets themselves without understanding the legal consequences of their actions.
It’s common for people to think they should pay off a loan from a family member or transfer the title of a vehicle or house to a friend or relative to “keep it safe.” Unfortunately, these actions can backfire badly. Bankruptcy law looks closely at various types of payments and transfers made within 90 days, one year, two years, and even as far back as ten years before filing depending on the type of transaction. Paying back a friend or relative can be considered a “preferential payment” that a bankruptcy trustee can recover. Transferring property for less than fair market value can be considered as a “fraudulent transfer,” putting your discharge at risk.
This doesn’t mean you can’t pay certain debts or make any transfers before filing, but it must be done the right way and for valid reasons, with full disclosure and proper documentation. We help our clients understand what’s allowed, what’s risky, and what could cause trouble down the line.
Potential Lawsuits and Personal Injury Claims
One area people often overlook is the potential value of lawsuits or legal claims they may already have. For example, if you were hurt in an accident and you have a pending personal injury lawsuit or you could potentially file one, that claim is considered an asset in your bankruptcy.
Nevada law provides exemptions that can protect a portion of a personal injury settlement or judgment. But the details matter: how much is protected depends on the nature of the claim, the amount awarded, and when you receive the funds. Failing to disclose a claim, or a potential claim, can lead to serious consequences including loss of the right to pursue the claim or receive any money recovery from it, and can result in facing allegations of bankruptcy fraud.
When you work with us, we’ll ask the right questions: Have you been injured recently, either personally or financially? Are you currently suing anyone or think you may be able to sue someone? Are you involved a dispute that could result in a settlement? We’ll help you determine whether you should pursue a claim now, wait, or take specific steps to maximize the protection of those claims and your rights of recovery under Nevada exemption laws.
Inheritances and Gifts
Another issue that surprises many clients is how inheritances can affect a bankruptcy case. If someone in your family recently passed away or you expect to inherit from an estate, you need to understand how that money or property could be treated in your case.
Under bankruptcy law, inheritances received before and even after filing can become part of the bankruptcy estate. That means the trustee could potentially use those funds to pay creditors, unless an exemption applies. Some inherited assets, like life insurance proceeds, qualified retirement accounts, and certain trusts, may be protected or partially exempt, but it depends on the type of asset and its value.
When we sit down with you, we’ll talk about any expected inheritances and how to time your filing to avoid unwanted surprises. If necessary, we can coordinate with estate lawyers and your family to ensure you don’t lose valuable property because you didn’t plan properly.
Protecting Assets Legally
It’s natural to want to protect what you’ve worked hard to build — your home, your savings, your business. But there’s a right way and a wrong way to do it.
Some people hear about “asset protection” strategies and rush to set up trusts, to gift or transfer property, or spend down savings without understanding the consequences. Done improperly and without a clear understanding of the law, these actions can be undone by a trustee or bankruptcy court or result in allegations of fraud.
With smart, legitimate planning, however, you can maximize exemptions and position yourself for the best possible outcome. For example:
- Nevada Homestead Exemption: Nevada has one of the most generous homestead exemptions in the country. By properly recording a homestead declaration, you can protect equity in your primary residence up to the statutory limit. But timing and proper filing are critical.
- Asset Protection Trusts: Nevada law also allows for certain domestic asset protection trusts, but these must be established in advance and meet very specific requirements to be effective in bankruptcy.
- Paying Down Secured Loans: In some cases, paying down your mortgage or other secured debts before filing can help you protect home equity. But doing this without proper guidance, or with the intent to hinder creditors, can do significantly more harm than good.
Every case is different. The key is working with an experienced attorney who knows how Nevada exemptions work and how to use them to your benefit without creating problems that can undo your fresh start.
Know What You Own And What You Can Protect
One of the most valuable parts of pre-bankruptcy planning is taking a careful, honest inventory of all your property. This means more than just your house, car or the assets of your business. It includes bank accounts, retirement accounts, potential lawsuits, business interests, valuable collections, family heirlooms, beneficial interests in family trusts, and even cryptocurrency.
At Larson & Zirzow, we go through everything with you, step by step. Then we apply every exemption available under Nevada and federal law to protect as much of your property as possible. If something can’t be protected, we’ll talk you through your options and risks, so there are no surprises.
Planning With Experience On Your Side
Bankruptcy is one of the most powerful financial tools available to individuals and businesses facing serious debt, but it’s not forgiving if you make mistakes. Planning ahead with knowledgeable guidance can be the difference between losing valuable assets or keeping them, or between a smooth discharge and a complicated, costly case.
When you work with Larson & Zirzow, you benefit from decades of experience, Board-Certified bankruptcy expertise, and a team that knows how to spot pitfalls before they happen. We never rush our clients through the process. We listen, we ask the right questions, and we create a plan that works.
Start Preparing the Right Way – Contact Larson & Zirzow in Las Vegas Today
If you’re considering bankruptcy, now is the time to talk to an attorney before you make any big financial moves. We can help you plan a filing that protects what matters most, stops the stress, and sets you up for success. Contact Larson & Zirzow today to schedule a confidential consultation. Let’s build a smart strategy that gives you real relief and peace of mind that you’re doing it the right way.