What Happens If I Inherit Money After Filing for Bankruptcy in Ohio?
What Happens If I Inherit Money After Filing for Bankruptcy in Ohio?
Filing for bankruptcy can provide much-needed financial relief, but many people worry about how unexpected changes—like receiving an inheritance—might affect their case. If you inherit money after filing for bankruptcy in Ohio, the impact depends on the timing of the inheritance and the type of bankruptcy you filed. Understanding these rules can help you avoid surprises and protect your financial fresh start.
Understanding Inheritances and Bankruptcy in Ohio
In Ohio, as in the rest of the country, bankruptcy law follows federal rules regarding inheritances. When you file for bankruptcy, a bankruptcy estate is created. This estate includes certain assets you own at the time of filing and, in some cases, assets you acquire shortly afterward.
An inheritance can become part of the bankruptcy estate depending on when you become entitled to it, not necessarily when you receive the money.
The 180-Day Rule and Why It Matters
One of the most important rules to know is the 180-day rule. If you become entitled to an inheritance within 180 days (about six months) after filing for bankruptcy, that inheritance is generally considered part of the bankruptcy estate.
This applies if the inheritance comes from:
- A will
- A trust
- A life insurance payout due to someone’s death
If the inheritance falls within this 180-day window, you are required to disclose it to the bankruptcy court.
What If the Inheritance Comes After 180 Days?
If you become entitled to the inheritance more than 180 days after filing, it usually does not become part of the bankruptcy estate. In many cases, this means you may be able to keep the inherited funds without affecting your bankruptcy case. However, timing and specific circumstances matter, so careful review is important.
Differences Between Chapter 7 and Chapter 13 Bankruptcy
The type of bankruptcy you file also plays a role.
In a Chapter 7 case, a trustee may be able to use a qualifying inheritance to pay creditors if it becomes part of the estate. This could reduce or eliminate the financial benefit of the inheritance.
In a Chapter 13 case, an inheritance received during the repayment period may lead to changes in your repayment plan. The court may require higher payments to creditors based on your improved financial situation.
The Importance of Disclosure
Failing to disclose an inheritance can lead to serious consequences, including dismissal of your case or loss of your bankruptcy discharge. Even if you are unsure whether the inheritance counts, it is always safer to report it and seek guidance on how it should be handled.
Getting Guidance Before Problems Arise
Inheritance issues can be complex, especially when they intersect with bankruptcy timelines and court rules. At Roderick Linton Belfance, LLP, we can provide legal assistance to the Akron public by helping individuals understand their obligations and options when unexpected assets arise during a bankruptcy case.










