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relative death bankruptcy consumer bankruptcy
A relative died after my case was filed. What happens to the life insurance proceeds?
An inheritance or life insurance payment you receive within 180 days after filing is part of the bankruptcy estate. If you chose the federal exemptions when you filed, life insurance on someone you depended on for support would be exempt to the extent reasonably necessary for your support and the support of your dependents. If you chose your state’s exemptions (or if your state doesn’t allow someone to choose between federal and state exemptions), you may find that life insurance proceeds are fully or partially exempt.
(Reviewed 11.14.08)
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