Common Exemptions to Bankruptcy

There are exemptions for people filing for bankruptcy but the exemptions vary from state to state and are based on each individual case. There are exemptions when filing for bankruptcy for people of all financial backgrounds. These exemptions are put into place to help people obtain a fresh start after they are finished filing for bankruptcy and their case is complete. There is a major list of bankruptcy exemptions but they do differ from state to state. Anyone filing for bankruptcy should consult a bankruptcy lawyer, who will be able to give the filing party a full list of exemptions. The major list of exemptions includes $20,200 for the home, $9,850 for a life insurance policy, $9,850 for household goods, $1,225 in jewelry, $3,225 for a motor vehicle, $18,450 for personal injury compensation payments, $1,850 for books and equipment pertaining to the filing party’s profession and $925 in a wild card category for any piece of property.

The content of this article is provided for informational purposes only. If you need legal assistance with a bankruptcy, please consult with a Bankruptcy Lawyer in your area to discuss the details of your case.

Other Exemptions

Other exemptions provided by the federal government for people filing for bankruptcy include but are not limited to:

  • Health aides - unlimited
  • Burial plots -  up to $16,500 and is in lieu of real estate exemption
  • Wages – none
  • Wrongful death funds – amount needed for support
  • Lost earnings payments – unlimited amount
  • Retirement benefits – amount needed for support
  • Alimony and child support – amount needed for support
  • Unemployment compensation – unlimited amount
  • Veterans benefits – unlimited amount
  • Social Security benefits – unlimited amount
  • Public assistance – unlimited amount
  • Crime victims compensation – unlimited amount
  • Disability – unlimited amount
  • Unemployment benefits – unlimited amount
  • Un-matured life insurance – unlimited amount
  • Life insurance policy loan value up to $8,625
  • Life insurance proceeds – amount needed for support

A court of law in a bankruptcy case will not announce to the debtor which pieces of property they are allowed to claim as exempt. The debtor should know what pieces of property to claim as exempt when they begin the filing process. A bankruptcy lawyer will be able to help the party filing for bankruptcy decide which pieces of their property they should claim as exempt and help them file their exemption claims. The most important form needing to be filled out and submitted to the government when filing for bankruptcy and claiming exemptions is the Schedule C Form. The party filing for bankruptcy must list all of the property they wish to keep during the bankruptcy process and list the value of each piece as well on the Schedule C Form. There are federal exemptions and state exemptions and most states in the country will allow the party filing for bankruptcy to decide which exemptions they wish to use when filing; the federal exemptions or the state exemptions.

The states that allow people to use federal exemptions include Arkansas, Connecticut, Washington, D.C., Hawaii, Massachusetts, Michigan, Minnesota, New Jersey, New Mexico, Pennsylvania, Rhode Island, South Carolina, Texas, Vermont, Washington, and Wisconsin. The states that do not allow people to use federal exemptions include Alaska, Arizona, California, Colorado, Delaware, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Tennessee, Utah, Virginia, West Virginia, and Wyoming.

 

The content of this article is provided for informational purposes only. If you need legal assistance with a bankruptcy, please consult with a Bankruptcy Lawyer in your area to discuss the details of your case.
FEATURED LISTINGS FROM NOLO
Swipe to view more
NOLODRUPAL-web1:DRU1.6.12.2.20161011.41205