If you file for Chapter 7 or Chapter 13 bankruptcy, you must complete forms that disclose your income, expenses, debt, and the types of real property (real estate) and personal property you own. One of the forms is called the Statement of Financial Affairs for Individuals Filing for Bankruptcy.

On this form (which you may find and complete on the uscourts.gov website) you will list financial transactions you made up to ten years before you filed for bankruptcy. The bankruptcy trustee will review these transactions and may undo a sale, gift, or transfer of property the trustee determines should be used to pay your creditors. Sales, gifts, debt payments, and transfers of property to your friends and family members are known as insider payments, and will receive the most scrutiny.

In Ohio, as in all states, when filing for Chapter 7 or Chapter 13 bankruptcy, debtors are required to complete and submit various forms that provide a detailed account of their financial situation. One essential form is the Statement of Financial Affairs for Individuals Filing for Bankruptcy, which is available on the uscourts.gov website. This form requires the disclosure of significant financial transactions that occurred up to ten years prior to filing for bankruptcy. The bankruptcy trustee assigned to the case will examine these transactions to identify any that could be reversed to gather assets for repaying creditors. Particular attention is given to 'insider payments,' which include sales, gifts, debt repayments, or property transfers to friends, family members, or other close associates. These transactions are scrutinized because they may be considered preferential or fraudulent transfers, intended to shield assets from the bankruptcy estate. If the trustee determines that such a transaction should be undone to satisfy debts, they have the authority to take legal action to recover those assets for the benefit of all creditors.