Bank Account Levy and Paypal

[businessman]

I have a levy coming up on all my bank accounts from Chase Bank. I keep very little money in there, and will be filing Chapter 7 in a few weeks. My problem is that I have a Paypal balance of $3000 that I need to use for rent/food/gas, but am not sure how to get access to the money. I've just moved (our house was foreclosed and now we're renting), and to get a debit card from Paypal, they need to confirm my address matches one of my credit card mailing addresses, which it does not now.

I was going to use the debit card for needs, but it doesn't appear I can get one from paypal. Is the money safe staying in Paypal through my bankruptcy, or should I get a Paypal paper check mailed to me, disclose that to my attorney and trustee (that I'll be using it for rent), and just hold onto it until my case is discharged? I need access to the money, but I don't want it to hit my bank right when the levy may freeze it.

I also fear getting a paper check, cashing it before the levy at my bank, and having that big $3000 cashed check as the very last thing I do before I file...even with disclosing it. Not sure what to do...any tips welcome!

[tcreegan]

paypal acct = asset

Hello business,

The 3K sitting in the paypal account is a cash asset and the trustee will want that to distribute to your creditors.

Get it out in check form, cash it, and spend it on necessary household expenses: rent, gas, food, clothes, utility bills, etc. Avoid anything vaguely like a luxury item. Keep recp'ts so you can document where the $$ went.

Now we need some of the gurus to weigh in on a time frame to filing after getting the 3K in hand. Immediately b4 filing seems to soon, so wait how long; a month, 90 days, 6 months, a year?

Also, what state are you filing in? Some states have exemptions for cash and you might not have to worry about it.

Hope this helps, maybe a little,

Tom in Colo

[Flamingo]

PayPal is not a bank and is a custodial account. Funds in that account are an asset as you have access to those funds. It is easily traceable. If you transfer that money out within six months prior to filing, you will need to disclose the amount and what you did with it. Some trustees go back further than six months for checking on accounts, transfers, etc. Your best bet would be discuss with a BK attorney in your area before you do anything further.

[bigtim6656]

I would think it would be a account and thus an asset. If you pull it out and spend it on rent, food and such I see no issue. I will be getting my student loan in a month and my lawyer told me to spend it and then file. He did not even tell me to be careful how I spent it. Would the trustee find out about your paypal account unlikely, but possible and it is easier to say I had it and spent it on bills then to say I have it and can buy what ever with it.

From alittle searching it seems cali has a wildcard exemption and you might be ok that way. I doubt paypal would turn your money over to anyone without a court order.

With the wildcard I would talk to your lawyer.

[bigtim6656]

hey I got a question do I need to claim my paypal account when I file if there is no money and I mean it has a balance of 0.00

[iv65536]

hey I got a question do I need to claim my paypal account when I file if there is no money and I mean it has a balance of 0.00

I don't see it as necessary since a zero balance would be neither an asset nor a liability.

That being said, if you have a Paypal debit card and are using a bank account for backup funding, I would stop using it 10-14 days before filing.

Another question: would rewards from a debit card earned but not received be considered an asset? Also, for those that use a bank that reimburses ATM fees, would the fees paid but not yet reimbursed be considered an asset?