Preferential Payment Definition | Becker
Accounting Dictionary
Preferential Payment
A transfer made by the debtor to or for the benefit of a creditor for an antecedent debt that resulted in the creditor receiving more than the creditor would have received under the Bankruptcy Code. The transfer must have been made within 90 days of the petition (within one year of the petition if the creditor was an insider) and made while the debtor was insolvent. Also called "voidable preference.