The Perfect Day to File Your Chapter 7 Bankruptcy in Arizona

If anything gives me more sleepless nights than this one, I don't know what it is.

And I'm going to revisit this issue several times, because there's a lot here.

First, it's probably a good idea NOT to file your bankruptcy until a year and a day after you repaid mom the million dollars. Read up on preference payments to insiders in bankruptcy. They're not illegal or fattening, but do result in lawsuits against mom.

Nobody likes that. Not even the trustees. But they'll do their duty and sue mom.

And how about waiting until you've bought groceries and paid the mortgage with cashier's checks, so that the amount in your bank account is the exemption in Arizona (make sure you keep the receipts and make a list of where you spent the dough; inquiring trustee minds want to know).

Might be nice if you paid your lawyer prior to filing, because if you owe money to your bankruptcy lawyer on the day you file....oh, well. I guess you don't owe any money to your bankruptcy lawyer! Note: according to the rule of unintended consequences, that makes bankruptcy lawyers much less likely to agree to take payments after the filing. Sadly, well meaning people who promise to pay afterward for hamburgers or bankruptcy cases today often decide afterward that they have higher priorities for their spending.

Note to Congress: might be nice if people could pay for bankruptcy over time, rather than prior to filing.

How about waiting, if you can, until after you receive your tax refunds and use them to buy food, fuel and provisions for six months, which is exempt in Arizona. One Arizona Bankruptcy Trustee, and a very good one, calls tax refund time "Dicken's Season", because it makes her feel like Scrooge.

And how about if you're scheduled to have your chest cracked? Probably good to wait until after you've gotten through recuperation, because the surgery and the post-surgical treatments may cost a couple hundred thousand that aren't covered by insurance.

And you probably don't want to file if Uncle Gotrocks is going to die within six months of the filing date. Because your inheritance is property of the bankruptcy estate under 11 USC 541. And it would be nice if his favorite nephew was able to eat well on his bequest.

Maybe prior to the trustee's sale, so the debtor has a little more time to get affairs in order to move. Remember to tell your Arizona bankruptcy lawyer if you move within three or four years of filing, if the case is still open, so he can tell the Court. And no, just because you received a discharge, that doesn't mean the case is closed!

And maybe AFTER the debtor has not used credit cards for 90 days. Because of the presumption that credit card amounts charged up within 90 days are not discharged.

After you've been residing in this jurisdiction for more than half of the last 120 days might be good, for venue and jurisdictional purposes.

There are other relevant time periods to discuss.

Watch this space.

Note: there is no perfect day to file; there are only degrees of imperfect, because of the nature of time and the world.

Assume that you will lose something to the bankruptcy trustee, whether it's 25% of your net wages owed to you on the date of filing, or the pool table, or the gun safe, or something else that's relatively unimportant to you. The important thing that you need to lose is the ten million in debt. Really.