THE FEDERAL EXEMPTIONS AS ESTABLISHED BY CONGRESS
Certain property which falls within the description of property of the estate is exempted either by exemptions established by the U.S. Congress, called Federal Exemptions, or by exemptions established by states, called State Exemptions. in some states Debtors are free to choose either the Federal or the State Exemptions. Pennsylvania allows such a choice. Property exempted from the bankrupt estate is not subject to the claims of creditors.
The federal exemptions are found in section 522(b) of the Bankruptcy Code.
The Debtor’s interest (value minus secured debt, as an example, if the debtor owns a house worth $50,000 subject to a mortgage of $50,000 the debtor’s interest is $10,000) in the following:
(1) residential exemption: Real(such as a house) or personal property(such as a mobile home or trailer) used as a residence $23,675.00;
(2) motor vehicle exemption: A motor vehicle $3775.00;
(3) household goods exemption: Any particular household goods(such as furnishings, wearing apparel, appliances, books, animals, crops, musical instruments that are held for personal, family, or household use of the debtor or a dependent of the debtor, $600.00 or in the aggregate $12,625;
(4) personal jewelry exemption: Jewelry held for family or household use $1600.00 of the debtor or a dependent of the debtor; also a life insurance policy with a cash value of up to $12,625.00.
(5) wildcard exemption :Aggregate interest in any property not to exceed a value of $1250.00 plus up to $11,850.00 an any unused portion of the residential exemption.
(6) tools of the trade exemption: Implements, professional books, or tools of the trade of the debtor or a dependent of the debtor $2,375.00;
(7) life insurance exemption: Any unmatured life insurance contract owned by the debtor other than a credit life insurance contract( a life insurance policy designed to pay off a borrower’s debt if that borrower dies).
(8) health aids exemption: Professionally prescribed health aids for the debtor or a dependent of the debtor.
(9) transfer exemption: certain transfer by a life insurance company such as a provisions for an automatic policy loan to prevent forfeiture of a policy, see section 542(d) of the Bankruptcy Code.
(10) The debtor’s right to receive—
(A) a social security benefit, unemployment compensation, or a local public assistance benefit;
(B) a veterans’ benefit;
(C) a disability, illness, or unemployment benefit;
(D) alimony, support, or separate maintenance, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor;
(E) a payment under a stock bonus, pension, profit sharing, annuity, or similar plan or contract on account of illness, disability, death, age, or length of service, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor, but subject to some exception.
(11) The debtor’s right to receive, or property that is traceable to—
(A) an award under a crime victim’s reparation law;
(B) a payment on account of the wrongful death of an individual of whom the debtor was a dependent, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor;
(C) a payment under a life insurance contract that insured the life of an individual of whom the debtor was a dependent on the date of such individual’s death, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor;
(D) a payment, not to exceed $23,675, on account of personal bodily injury, but subject to some exception; or
(E) a payment in compensation of loss of future earnings of the debtor or an individual of whom the debtor is or was a dependent, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor.
(12) Retirement funds to the extent that those funds are in a fund or account that is exempt from taxation under section 401, 403, 408, 408A, 414, 457, or 501(a) of the Internal Revenue Code of 1986.
WAIVER OF EXEMPTIONS
A waiver of any of the above exemptions is unenforceable in a bankruptcy proceeding.
with the help of an experience bankruptcy lawyer, many debtors can keep their property and discharge their debts. This gives them a fresh start.
Call bankruptcy lawyer C. Stephen Gurdin Jr. at his Wilkes-Barre-Scranton office today at 570.826.0481, toll free at 800-221-0618, fax 570-822-7780, email Stephen@gurdinlaw.com to schedule a free consultation.
Regular Office hours 2:30 and 7 p.m. Monday through Friday by appointment. Earlier appointments available upon request.