Bankruptcy Exemptions What Should the Debtor Be Looking For?

Written by Adam Peck Category: Nursing Homes January 23rd, 2013 2 min read

Chapter 7 bankruptcy
is commonly referred to as “liquidation” bankruptcy. It cancels debt entirely in the course of approximately three months and is an attractive option for many people considering bankruptcy. The down side for many is that filing for Chapter 7 means that any non-exempt belongings will be liquidated to distribute among creditors in order to pay off debts. When you file for Chapter 7, it is critical to know what exemptions will be included. Clearly understanding your options can help you make the right decision. Since exemptions differ from the state and federal laws, it is recommended to clarify your state’s laws before filing. Here are some sample exemptions.

States have an exemption on homesteads for individuals filing for Chapter 7 bankruptcy. The way to determine what state to use for your exemption is by looking at where you lived for the 730 days before filing. If you didn’t live in a single state for the past two years, you can determine your state by looking at the past 180 days and see where you lived for the majority of that time. If you are ineligible for state exemptions, you can take federal exemptions.

On the federal level, exemptions include a Homestead exemption of $21,625, a jewelry exemption of $1,450, a motor vehicle exemption of $3,450, an exemption of $2,175 that covers tools of the trade and including books and other equipment used for work, plus an exemption of $550 per item in any household goods up to a total of $11,525.

For the state of California, bankruptcy exemptions include homestead exemptions, personal property including appliances, furnishings, clothing, building materials for home repair, burial plots, health aids, jewelry and heirlooms, motor vehicles, personal injury and wrongful death causes of action and recoveries needed for support. Additionally, insurance, property of business partnerships, pensions and retirement income – including IRAs and Keoghs, tools of the trade and public benefits – are all exempt.

Share it

Questions? Check with Peck Today

Blog Lead Form

Elder Abuse and Neglect in Assisted Living Facilities

Elopement in Nursing Homes

Assisted Living Abuse

Settlement Reached in Assisted Living Facility Death

Assisted Living Abuse and Neglect Attorneys

Written by Adam Peck

Expertise: Personal Injury

Adam J. Peck, ESQ is a principal with Peck Law Group, APC. In 2008, Mr. Adam Peck received his Juris Doctorate from Whittier Law School where he graduated Cum Laude. His practice is primarily dedicated to representing Elders, Dependent Adults, along with their loved ones and family members, who have suffered horrific personal injuries.