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Federal laws govern the process and procedures of all bankruptcies, however many states provide their own exemptions. For example in New York bankruptcy petitions, the debtor may decide in Chapter 7 petitions whether to follow state or federal asset exemption guidelines.
Many individuals are unaware of the laws surrounding their assets when they file for bankruptcy. It is very important for every debtor to be fully aware of the assets they are required to list or they could find themselves in trouble with the presiding judge or trustee. If a property is found to be exempt, then the debtor is allowed to keep the asset. If it is found to not be exempt, then the trustee or judge may liquidate the assets to pay a creditor. Below is a list of examples of what most bankruptcy courts find to be exempt and non-exempt assets.
Exempt property: vehicles, up to a certain value; necessary clothing; household goods and furnishings that are found to reasonable and necessary; household appliances; jewelry up to a certain value; pensions or retirement plans; any essential tools required for the debtor’s trade or profession, up to a certain value; a portion of any unpaid earned wages; any damages awarded to the debtor in a personal injury lawsuit up to a certain amount; any public assistance or compensation that may be collected and deposited into a bank account; and a reasonable portion of equity in the debtor’s home if they own it.
Non-exempt property: Additional real estate property that are not the debtor’s primary residents; Additional motor vehicles owned by the debtor that are not their primary way of transportation; family heirlooms, up to a certain value; Valuable items that the trustee deems as just and appropriate under the governing laws; cash, stocks, bonds, investments, and funds in a bank account, up to a certain value; and Valuable collections such as stamps, coins, or antiques.
Again the governing laws vary depending on where a debtor decides to file their petition. It is important for a debtor to discuss with a bankruptcy attorney about all of their options and the guidelines they must follow regarding their assets.
If you are considering filing for bankruptcy, you should seek the assistance of a qualified attorney. Jayson Lutzky has over 29 years of experience practicing bankruptcy law and has worked for thousands of satisfied clients. To set up a free initial consultation, contact the law offices of Jayson Lutzky, P.C.at (800) 660-5299 or contact us via our website, www.BankruptcyNYC.com.