Posts Tagged ‘recovering unclaimed funds in bankruptcy’

Recovering Unclaimed Funds In A Bankruptcy Case

If there are still some funds available (unclaimed) after the bankruptcy trustee pays off all creditors from the proceeds of the liquidation of your assets and properties, you have the legal right to claim for that fund. However, recovering unclaimed funds in a bankruptcy case is not at all an easy task. The process can be a little complicated depending upon the types of factors involved in your specific case. The rules and laws may also however vary depending upon the state where you have filed the bankruptcy petition. It is also very important to note that it is not just debtor but even a creditor has the right to claim that part of that fund if they think they have not been able to recover the full amount of debt. Besides that, you also need to keep in mind that if no one claims for that fund within five years from the date when the last payment was made to the creditors, the money will go to the U.S. Treasury. Therefore, if you want to claim, you must file a motion to the court for release of funds within the specified period. Following is a brief rundown on how to go about it.

Prepare A Motion

When it comes to recovering unclaimed funds in a bankruptcy case, the first thing you have to do is to prepare a motion. You will have to provide some basic details in the motion, such as tax identification number, the last four numbers of your social security number, telephone number, email, your name and address, and your bankruptcy case information.

If You Are An Individual

When an individual files a motion to claim the excess funds held by the bankruptcy court, he/she is also required to attach a copy of the driving license with the motion.

Power Of Attorney

If you are not legally entitled to the unclaimed funds and are filing the motion for recovering unclaimed funds in a bankruptcy case on someone else’s behalf (such as on behalf of your company), you will also have to attach an executed power of attorney with the motion. There might also be a situation when the actual debtor has died. In such cases, the person filing the motion on behalf of that deceased individual must also attach some probate documents (along with a copy of the death certificate) with the motion to prove that they are legally allowed to claim funds on behalf of the descendant.

Submit The Motion

Double check the information you have provided in the motion and the types of documents you have attached with it before you file it with the clerk of the bankruptcy courts. Do not forget to attach a certificate of service, which is a proof that a copy of the motion has also been sent to the US Attorney.

As part of the process of recovering unclaimed funds in a bankruptcy case, you are also required to file a proposed order in a specific form, where you must mention the amount of money you are claiming and the address where the check must be sent to. The unclaimed funds will be released only after the judge signs that proposed order. In some cases, your proposed order may get rejected and the court may still issue you a check but for a reduced amount.

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