What should I do with my childrens cars in my bankruptcy?

Yes, if the titles were transferred recently it will appear that you transferred assets to avoid the ability of creditors to reach them and thus the bankruptcy will be denied. Because they're family, you'd have to wait something like 3 years before you could file. It might be possible to re-title them in your name and then file. Or file and disclose the transfer. Questions are whether the cars are paid for and whether they have any equity. If not paid for, then the trustee would have no interest in them. If paid for but little equity, the trustee may still be disinterested. You really should see an attorney to determine your best course of action.

Have you hired an attorney yet? Talk to him/her about it. So long as the transfer is disclosed and value of your interest in the vehicles is disclosed I don't think you should have a problem. You just need to make sure you deal with it appropriately in the schedules. Make sure your attorney understands that these transfers occurred and must be disclosed properly.

I hate to tell you but you appear to have screwed up very badly. The transfer of titles to a relative can result in many things including denial of a bankruptcy discharge, loss of the cars, and even criminal prosecution. Even two year old transfers MUST be reported to the court. Discuss this with your lawyer. And do not do anything else before you see your lawyer. You probably did something unnecessary and foolish. If you had kept the cars in your name, depending on the value, you might have been able to keep them anyway using exemptions in the bankruptcy code. By transferring them, you lost those exemptions and the court may be able to sue your children.

The Bankruptcy Code look-back period for "fraudulent transfers-" which is not strictly a function of intent, but of objective circumstances at the time notwithstanding good intentions is 2 years. However state fraudulent transfer statutes also dictate treatment. In CA, the usual look-back period for fraudulent transfers is 4 years. Yes, this is a problem. The values of the vehicles is significant. You must discuss all facts with a bankruptcy attorney pronto. See 11 USC Section 548 and CA CCP 3439.09 and consult with an attorney regarding any transfer issues.

Those transfers have to be reported in your Statement of Financial Affairs which must be filed as part of your bankruptcy petition. The trustee can ask the court set aside the transfers and recover the vehicles to be sold in order to pay for your debts. In some cases the trustee can go back up to four years to set aside a transfer of an asset although usually two years is the limit to set aside a transfer. Depending on the value of the vehicles and when you made the transfer that could be a problem. You need to write down all the information, such as dates of transfer and value of vehicles, and see a bankruptcy attorney for advice on whether you should file now or wait. You could argue that the cars were not really yours and you were only on title because the kids were minors when the vehicles were bought but that is risky if the trustee disputes that and goes after the vehicles.

Timing is everything in bankruptcy. Any transfers to family members within a year of filing bankruptcy can be reversed and made part of the bankruptcy estate and if no exemption is available, the assets may be seized and liquidated by the bankruptcy trustee.

Depending upon how you use your other exemptions, it might be best to list the cars as your assets and exempt them, if possible. If you are in my area and are looking for an attorney, please contact me for a free consultation.

When you transferred title to the cars in your name to your children you created a voidable transfer. The trustee can now recover title for the bankruptcy estate. The timing is one year prior to the bankruptcy. You would have to wait one year before losing the cars to the trustee. You might want to have the cars transferred back to your name prior to filing bankruptcy.