Due to a job loss, Gail filed for bankruptcy. At the 341 Meeting of Creditors, there seemed to be no issues, and her attorney told her to expect the Order of Discharge in a few months, that everything was okay. One hundred seventy-eight days later, Gail received a check for $10,000 from a life insurance company. Unbeknownst to her, her long-lost aunt passed away and had her listed as a beneficiary on a life insurance policy. Is the trustee entitled to the funds?

Question

Quizplus · Accepted Answer

The trustee is entitled to the funds because, under bankruptcy law, any inheritance or life insurance benefits that a debtor becomes entitled to receive within 180 days after filing for bankruptcy becomes part of the bankruptcy estate.

Due to a Job Loss, Gail Filed for Bankruptcy