Chapter 7 Bankruptcy Exemptions
What You Should Know about Exempt Vs. Non-Exempt Property
In some Chapter 7 bankruptcy cases, a debtor may have to turn over some of his or her property to a bankruptcy trustee. It’s the bankruptcy trustee’s job to determine which, if any, of your property can be liquidated (sold) to payoff your debts.
This is often a frightening thought for potential bankruptcy filers. Understandingly, no one wants to part with his or her hard-earned assets. To find out which of your property is exempt, fill out our free bankruptcy evaluation form or call 1 (888) 632-0501 to be connected with a local bankruptcy lawyer.
There is protection from Chapter 7 bankruptcy liquidation. If your property is considered exempt, you’ll probably be permitted to keep it. In other good news, most Chapter 7 filers do not have any non-exempt property, meaning that there is no liquidation.
Listed below are some examples of Chapter 7 exemptions and items that are not exempt from Chapter 7 liquidation.
Which Property Is Exempt from Chapter 7 Liquidation?
Chapter 7 bankruptcy exemptions vary from state to state but may include your:
- home;
- home’s equity (a portion of it);
- car;
- land you own;
- equipment and items needed for work;
- insurance and pension payouts;
- public benefits (like unemployment payments or workers compensation);
- jewelry, up to a certain value; and
- various personal property (like furniture, appliances and clothing).
Generally, Chapter 7 bankruptcy exemptions will protect all of your property from being sold to the creditors’ benefit; however, exemptions vary from state to state. For this reason, it’s not safe to assume that all of your property is automatically considered exempt in the eyes of the bankruptcy law.
A bankruptcy attorney is a good resource to help you understand which of your property is considered exempt or non-exempt property under the Chapter 7 bankruptcy law.
Property That Can Be Subject to Chapter 7 Liquidation
If you’re filing Chapter 7 bankruptcy, the below-listed property may be at risk for liquidation:
- additional homes;
- vacation homes;
- a second vehicle;
- family heirlooms;
- valuable collector items; and
- cash, bank accounts, stocks, bonds and other investments.
Remember, if any of those items are necessary for your job, you may be able to claim them as exempt property.
Still Wondering If Your Assets Are Exempt Vs. Non-Exempt Property?
Are you considering filing bankruptcy but not sure whether your property is considered exempt or non-exempt? A bankruptcy lawyer can advise you on which of your property could be protected from liquidation.
To connect to a local bankruptcy lawyer, fill out our free bankruptcy evaluation form or call 1 (888) 632-0501.