The overall objective of bankruptcy law is to allow honest insolvent debtors to surrender most of their assets and obtain release from their debts.
A secondary purpose is to give creditors fair opportunity to share in the debtor’s limited assets in proportion to their claims.
Bankruptcy questions normally emphasize when involuntary and voluntary proceedings can be conducted, the federal exemptions, the role of the trustee in bankruptcy, preferential transfers, priorities of the creditors, and conditions under which debts may be discharged in bankruptcy. Although bankruptcy under Chapter 7 is emphasized on the CPA examination, you should also be familiar with the other portions of this module. Recently, for example, Chapter 11 on Business Reorganizations has received some increased treatment. Before beginning the reading you should review the key terms at the end of the module.
A. Alternatives to Bankruptcy Proceedings
B. Bankruptcy in General
C. Types of Bankruptcy
D. Filing the Bankruptcy Petition
E. Chapter 7 Voluntary Bankruptcy Petitions
F. Chapter 7 Involuntary Bankruptcy Petitions
G. Chapter 7 Bankruptcy Proceedings
I. Priority of Claims
J. Discharge of the Debtor
K. Debts Not Discharged by Bankruptcy
L. Revocation of Discharge
N. Business Reorganization—Chapter 11
O. Debts Adjustment Plans—Chapter 13
P. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005
Q. Bankruptcy Fees