In Chapter 11 what is the lookback period for paid bill just prior to the filing?
Napa, CA |
Our business has taken a turn for the worse and we have to file for Chapter 11. How many days is the lookback peroid from the date we file for bankruptcy? How far can we "look back" and retrieve the money that we used to pay bills?
In Northwestern Ohio, the Trustees are not interested in taking back preferential payments to "non-insiders" when the payments total less than $600.00 in the 90 day lookback period. Still, I do not recommend making such payments.
The lookback period for preferential transfers under section 547 of the Bankruptcy Code is 90 days with respect to non-insiders, and 1 year with respect to insiders.
To recover payments based upon those payments having been fraudulent transfers (which is unlikely) the applicable lookback period is 2 years under section 548 of the US Bankruptcy Code and potentially longer under the state-law statute of limitations applicable to the UFTA.
Note that the jurisdictional minimum is, as of April 1, 2010, $5,850. That assumes that the chapter 11 debtor's debts are not primarily consumer debts.
These are general guidelines. If you are contemplating a chapter 11 filing, you will need to consult with an attorney who practices in that field.