Bankruptcy Exemptions: Boca Raton Bankruptcy
State and Federal Bankruptcy Exemptions
People who file for bankruptcy may be able to retain some of their real and personal property. There are assets that are exempt from bankruptcy, which means they are not used to pay off creditors. There are federal bankruptcy laws that include the federal bankruptcy exemptions. However, each state has bankruptcy exemptions and the states can decide which exemptions apply to bankruptcies in a particular state. Most states in the U.S. use their own bankruptcy exemptions, as does Florida. Filers are not allowed to choose some combination of state or federal exemptions, they must use one or the other depending on the rules of the particular state where they file their petition. Fortunately, the Florida exemptions tilt in favor of bankruptcy petitioners. The length of time the petitioner resides in Florida or elsewhere can affect the bankruptcy process and the available exemptions.
Homestead Exemption in Florida
Most states have a cap on the amount of value in a home covered by the homestead exemption and in that situation, a property value that exceeds the limit may be liquidated to satisfy the creditors. Florida differs in that there is no cap and there is no limit to the amount of value in a home or other property exempt under the homestead provisions. One limitation that does exist is the size of the property. It cannot exceed one-half acre in a municipality or 160 acres in a non-municipality. Another limitation is the length of ownership of the property. Prior to the filing of bankruptcy, the petitioner must be in ownership of the property for a minimum of 1,215 days. If the ownership falls short of that minimum, then the exemption is limited to $146,450.
Wage and Pension Exemptions
$750 in earnings per week is exempt if earned by the head of a household within the past six months, whether paid or unpaid. The pensions of federal government employees needed for support and earned up to three months before submitting a bankruptcy petition are exempt. Other exemptions for pensions include ERISA retirement plans as well as IRAs and other plans that qualify. Certain benefits from the Florida Retirement System, firefighter, police, and teacher pensions, as well as certain state and county offers and employee benefits, are exempt from bankruptcy. Additional exemptions include workers' compensation benefits, crime victims' compensation benefits, social security benefits, and local and state assistance.
Personal Property Exemptions in Florida
Personal property such as art, furniture, collections, appliances, and electronics are exempt up to $1,000. Hearing aids, medical equipment or other health aides are exempt if prescribed by a health care professional. Savings for education, health or natural disasters are exempt. The maximum motor vehicle equity is $1,000 if the filer is single. A married person who files jointly may receive a larger vehicle exemption amount.
Alimony, Child Support and Insurance Policy Exemptions
The alimony or child support that a divorced spouse/debtor receives that is necessary for his/her support and the support of a dependent is exempt. The payments to a beneficiary from a life insurance policy, the surrender value of a life insurance policy and any annuities, disability income, and other similar benefits are exempt in Florida.
The Wildcard Exemption
If the petitioner does not use the homestead exemption, then the Florida code allows the person to claim a maximum of $4,000 in personal property exemption.
We can provide you with further information about specific exemptions and the effect they may have on your bankruptcy. At Alan J. Fisher, PA we are ready to help you with your bankruptcy needs in Chapter 7 and
Chapter 13 bankruptcy.
For advice about bankruptcy exemptions, contact a Boca Raton bankruptcy attorney!