As per the rules of a few states, you are permitted to use the Federal Bankruptcy exemptions rather than the States exemptions. This completely depends on the state that you belong to-
This article will guide you –
- Name of states that allow you to select federal bankruptcy exemptions
- The permissible limit under federal exemptions
- Where to look for your States Exemptions
Can you use the Federal Bankruptcy Exemption?
At present, only a few states permit the filers to choose between state or federal bankruptcy exemptions. However, you must select only 1 and not both. For example, if you plan to opt for a federal bankruptcy exemption, then you cannot choose from the state exemptions criterion.
It is important to understand that the exemptions are applicable for chapter 7 and chapter 13, but not for your nonexempt property, as the assets are not protected by the exemptions. Their course of action will totally depend on the bankruptcy chapter you file under.
Property that is protected with federal Bankruptcy exemptions
A married couple can file for bankruptcy exemptions jointly, wherein you will get the benefit to double your exemption amounts. The common exemptions are mentiponed below-
1. The Homestead Exemptions – This helps to protext your residential property. An equity amount equalling $25,150 can be used to protect your place of residence. It is important that you reside in that property while you claim under Homstead exemptions. You cannot use this exemption to protect a rentaed or property purchased for investment purpose.
Residential property includes-
- A house or other place of dwelling eg – a commodium
- Your personal property such as your home
2. Personal Property Exemptions – This helps to protect all your personal belongings exclusing the Real Estate.
Personal Property Exemptions include-
· $4000 for Motor Vehicle
· $1700 for Jewellery
· $13400 sum for all household products like – furniture, clothes, books, appliances, aimals, instruments etc. $625 for individual items
· $2525 for Trade tools
· $13400 for life insurance interests, accrued dividents as well as Loan Value
3. Support or Benefit Exemptions – This includes all support help and benefits that you require –
· Child or spouse support
· Life insurance payments
· Unemployment benefits, vetarans benefits
· Illness benefits
4. Personal Injury Recovery Exemptions –
· $25150 for all types of personal injury except pain or monetary loss.
· If you need any support for the loss of future earnings
· If there has been any wrongful death of a person on whom you were dependent for support
· Exemptions for compensation received if your were a crime victim
5. Retirement Accounts Protections – There is a capping for Retirement Accounts at $1,362,800 for both IRA as well as ROTH IRA. Howeverm retirement accounts that have taxation exemption are fully exempted.
6. Wildcard Exemption – This is a special benefit that you can use for any property. At present, $1325 + $12575 value of the unused portion from your Homestead exemption can be used to for Wildcard exemption.
If you are looking for more details on how to get various exemptions, you can connect with the experts – Call: 888-297-6203.