May 17th, 2007 09:25 PM
Firearms and bankruptcy
Does bankruptcy prevents you from owning firearms? I haven't been able to find anything on the subject.
Someone I know might be filing for Chapter 7. That person is worried about being ordered to sell the two cheap firearms used for self defense (read a Glock and a S&W J-frame) in order to repay some of the debt. Anyone knows if this can be ordered by the court? (I've been browsing through the exempt property list but can't find firearms listed on it)
May 17th, 2007 09:32 PM
I dont think they can, but I dont know much (or anything) about the subject. How would they even know he has them, unless he tells them?
May 17th, 2007 09:36 PM
yes and no
depends on their value. then again who's to know? unless your filing and listing your x you should be safe. After BK is done go get as many as you can afford. Cash only credit will not be worth a darn.
May 17th, 2007 09:52 PM
Line # 8 of schedule B (form B6B) specifically asks for firearms owned. Link to form on .gov server:
Omitting the info is a felony under 18 USC Sec 152.
May 17th, 2007 09:54 PM
He could sell them to a trusted friend for a dollar...
May 18th, 2007 10:53 AM
Actually, doing that sort of thing immediately before filing bankruptcy can get you into a lot of trouble.
Originally Posted by SIXTO
For a Chapter 7 bankruptcy it is certainly possible that they would require him to sell firearms. The idea with Chapter 7 is that you sell everything you can do without, distribute the money among your creditors, and that's the end of it; you owe them nothing more after that.
If the judge buys into the notion that he needs a gun for self-defense then there's a good chance he will be required to sell all but one. He will almost surely be required to sell any guns that have significant collectors value. There is also, of course, the possibility that the judge will NOT believe that he needs a gun for self-defense and require him to sell all of his guns. You just never know until you get before the judge.
May 18th, 2007 11:03 AM
How tight is the situation? Can you (or someone trusted) give him $200. A sale for $100/each is credible, particularly if it is a question of paying utilities or creditors.
Chapter 7 is pretty nasty, and our wonderful Gvt. subsidised the banks by tightening the filing requirements, allowing the banks to show "collections" on the books, not "defaults". Regardless of the fact that the banks shouldn't be making roughly 30% of the loans they approve. Our Representatives in action.
May 18th, 2007 12:40 PM
They might not make him sell them. If the value of the firearms is peanuts to what he owes they may not even care. And it definitely wouldn't be worth the hassle of tracking all his friends down to ask them such questions.
May 18th, 2007 01:01 PM
It depends upon the state laws-
IIRC in Ohio you may keep a rifle and a shotgun (exempt)
just like in FL O.J.'s primary residence is judgment proof - Ron Goldman's family cannot force him to sell it to satisfy their 33 million dollar judgment...
Each state has different exemptions in bankruptcy - tell him to ask his lawyer...
May 18th, 2007 01:26 PM
Definitely a question for a lawyer, but if he actually paid money for a Glock, I can see why he's bankrupt.
Originally Posted by cagueits
May 18th, 2007 04:07 PM
Heres the list:
18 USC Sec 522 - Exemptions
(d) The following property may be exempted under subsection (b)(1) of this section:
(1) The debtor’s aggregate interest, not to exceed $15,000 in value, in real property or personal property that the debtor or a dependent of the debtor uses as a residence, in a cooperative that owns property that the debtor or a dependent of the debtor uses as a residence, or in a burial plot for the debtor or a dependent of the debtor.
(2) The debtor’s interest, not to exceed $2,400 in value, in one motor vehicle.
(3) The debtor’s interest, not to exceed $400 in value in any particular item or $8,000 in aggregate value, in household furnishings, household goods, wearing apparel, appliances, books, animals, crops, or musical instruments, that are held primarily for the personal, family, or household use of the debtor or a dependent of the debtor.
(4) The debtor’s aggregate interest, not to exceed $1,000 in value, in jewelry held primarily for the personal, family, or household use of the debtor or a dependent of the debtor.
(5) The debtor’s aggregate interest in any property, not to exceed in value $800 plus up to $7,500 of any unused amount of the exemption provided under paragraph (1) of this subsection.
(6) The debtor’s aggregate interest, not to exceed $1,500 in value, in any implements, professional books, or tools, of the trade of the debtor or the trade of a dependent of the debtor.
(7) Any unmatured life insurance contract owned by the debtor, other than a credit life insurance contract.
(8) The debtor’s aggregate interest, not to exceed in value $8,000 less any amount of property of the estate transferred in the manner specified in section 542 (d) of this title, in any accrued dividend or interest under, or loan value of, any unmatured life insurance contract owned by the debtor under which the insured is the debtor or an individual of whom the debtor is a dependent.
(9) Professionally prescribed health aids for the debtor or a dependent of the debtor.
(10) The debtor’s right to receive—
(A) a social security benefit, unemployment compensation, or a local public assistance benefit;
(B) a veterans’ benefit;
(C) a disability, illness, or unemployment benefit;
(D) alimony, support, or separate maintenance, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor;
(E) a payment under a stock bonus, pension, profitsharing, annuity, or similar plan or contract on account of illness, disability, death, age, or length of service, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor, unless—
(i) such plan or contract was established by or under the auspices of an insider that employed the debtor at the time the debtor’s rights under such plan or contract arose;
(ii) such payment is on account of age or length of service; and
(iii) such plan or contract does not qualify under section 401(a), 403(a), 403(b), or 408 of the Internal Revenue Code of 1986.
(11) The debtor’s right to receive, or property that is traceable to—
(A) an award under a crime victim’s reparation law;
(B) a payment on account of the wrongful death of an individual of whom the debtor was a dependent, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor;
(C) a payment under a life insurance contract that insured the life of an individual of whom the debtor was a dependent on the date of such individual’s death, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor;
(D) a payment, not to exceed $15,000, on account of personal bodily injury, not including pain and suffering or compensation for actual pecuniary loss, of the debtor or an individual of whom the debtor is a dependent; or
(E) a payment in compensation of loss of future earnings of the debtor or an individual of whom the debtor is or was a dependent, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor.
An attorney that I know gave me a brief explanation this morning. Apparently the firearms can be claimend under # 3 above, provided the state the person is domiciled for the 180 days prior to the filing doesn't say otherwise.
May 20th, 2007 09:57 PM
Originally Posted by kd5nrh
May 20th, 2007 10:56 PM
Depends on the State where you're at. You can elect to proceed under either the Bankruptcy Code's exemptions or under the exemption statute of your State.
Oklahoma's is pretty generous with regard to firearms...it used to be one gun and one gun only. They changed it a few years ago to allow you to claim up to $ 2,000.00 worth of guns as exempt (provided they're not for collecting purposes).
Don't have a clue about Puerto Rico, though.
BTW, at least here, your friend doesn't have much to worry about. The trustees just don't mess with piddly little stuff like the guns you've mentioned- - just make sure your friend DECLARES them on the schedules, and does NOT hide them. Disclose them. Period. Then the trustee will tell your friend what all of his property he is interested in. It probably won't be much.
"...bad decisions that turn out well often make heroes."
Gary D. Mitchell, A Sniper's Journey: The Truth About the Man and the Rifle, P. 103, NAL Caliber books, 2006, 1st Ed.
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