The State of California has Two Sets of Bankruptcy Exemptions

Written by Adam Peck Category: Nursing Homes January 23rd, 2013 3 min read

Federally sanctioned supplemental exemptions are permitted to be used according to the bankruptcy laws in California and can be used with the allowed California State exemptions. According to California bankruptcy laws, a person must choose one of two categories of exemption. The two categories are simply known as the 703 exemptions and the 704 exemptions. An experienced California Bankruptcy lawyer will be able to choose which set of California Bankurptcy exemptions would be proper in any particular case.

According to California law, one set of exemptionshas a homestead exemption of a maximum of $50,000 for one person who isn’t handicapped, a maximum of $75,000 for families and a maximum of $125,000 for seniors. In addition, this set of exemptions allows for personal property exemptions of as much as $2,000 cash in the bank; as much as $2,000 worth of building materials; as much as $5,000 worth of jewelry and heirlooms; motor vehicles valued up to $1,900; burial plots; appliances; home furnishings; personal clothing; health related aids; food; and any money that results from personal injury or wrongful death claims. Also, allowances are provided for the following under the first set of exemptions: any type of insurance claims; pensions; benefits like unemployment compensation; workers’ compensation claims; health assistance claims; tools of the trade which includes tools, uniforms, equipment, books and manuals needed to continue in a trade; and wages exempt at a minimum of 75%.

There are many differences between the 703 and 704 exemptions under California bankruptcy laws. For the 704 exemptions, $17,425 is the highest exemption for every homestead category. The maximum amount for jewelry and heirlooms is $1,150. The trade tools exemption is limited to $1,750 while the exemption for motor vehicles is as much as $2,775. In addition, this exemption allows the total amount of personal benefits that can be exempted at $17,425. However, a wild card exemption of as much as $925 is permitted. The 704 exemptions doesn’t have any wage exemption but there is an exemption for ERISA eligible pensions.

Due to the complexity involved in these two exemption systems under the California bankruptcy laws, people are strongly advised to engage a lawyer who specializes in this field of law for assistance with bankruptcy. Basically, a lawyer will consider all of your financial issues and advise you about which one of the two exemption systems would be right for you when your bankruptcy case is filed. says California Bankruptcy Lawyer Steven C. Peck who may be contacted toll free at 1.866.999.9085 or on-line at www.premierlegal.org

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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.