Bankruptcy while owning properties...

[John Milner]

INDIANA

My Mother-in-law owns both halves of a duplex. She's currently in quite a bit of credit card debt. She lives in one half and the other is rented out. My wife and I are going to purchase the rented half this summer. She wanted us to quick claim onto the rental half now, but we are not sure why? She said so she gets a "tax break". Can she file bankruptcy before selling us the half and her making money on it? Or should she do it before hand? We are a bit confused with the situation....

Thank you so much!

 

[bigun]

Don't let mom drag you into her financial problems. Property transfers involing insiders have a 2 year lookback period and the trustee can sue you for the return of the property.
I'd stay away from this deal until your mother gets her finances under control. Renting is one thing. I'd not buy or get involved in a quitclaim.