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Bankruptcy Exemptions

Unless a bankruptcy case is dismissed, property that is exempt under 11 U.S.C.S. § 522 is not available for the payment of any debt during or after bankruptcy, except for tax liens, educational loans and grants obtained by fraud, and debts secured by liens that are not avoided or cancelled.
 
Under federal bankruptcy law, exempt property includes:
 
·         Up to $20,200 in real property or personal property that the debtor or the debtor's dependent uses as a residence r burial plot,
·         Up to $3,225 interest in a motor vehicle,
·         Up to $525 in any one item, and up to $10,775 in total value in household goods, furnishings, and appliances,
·         Total interest, not to exceed $1,350 in personal jewelry,
·         Up to $1,075 interest in any property, up to $ 10,125 of any unused previously stated exemption amounts,
·         Up to $2,025 in professional tools, books, or equipment. And
·         Professional prescribed health aids.
 
The amounts that may be exempted are automatically adjusted every three years, based on the Consumer Price Index.
 
Also exempt under federal bankruptcy law is income from the following sources:
 
·         Social security benefits,
·         Unemployment compensation,
·         Local public assistance benefits,
·         Veteran's benefits,
·         Disability or illness benefits,
·         Alimony, support, or separate maintenance, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor; and
·         Certain annuity or pension benefits.
 
In addition to the listed exemptions, there are a few other exemptions under federal bankruptcy law, including certain income and assets relating to exempt property, personal injury claims, and victim reparation claims.  
 
Instead of federal exemptions, a debtor may elect the exemptions provided by the State in which the debtor lives. If the debtor elects the State exemption, he will also be entitled to those exemptions provided in federal laws, other than the bankruptcy law.  State exemptions vary from state, as to the amount exempted and the type of property. For instance, some States permit a homestead exemption; others do not.  The amount of the State exemption for the homestead also varies from state to state and may be modified.  The amount is determined by the law in existence at the time the petition for voluntary bankruptcy is filed. Further, the debtor can only claim the State exemptions available by the State in which the debtor lives on the date the petition is filed. However, federal law, in order to avoid abuse of the exemption, limits the amount that may be exempted where the debtor has liven in the property less than 1,215 days prior to the filing of a bankruptcy petition. The current limit is $136, 875.