Bankruptcy Exemptions

When you file bankruptcy you will make a list of all of your assets, including any personal property you have.  The personal property will fall into one of two categories – exempt and non-exempt.  Exemptions vary by state but in general the following types of items are exempt.  Motor vehicles to a certain value (to be determined on a case-by-case basis), reasonable and necessary clothing (fur coats are not usually considered reasonable and necessary), household appliances, reasonable and necessary household furnishings and goods, and jewelry to a certain value (again to be determined on a case-by-case basis).

In addition to the above-listed items, pensions, life insurance policies, part of the equity in your home, tools of your profession, and public benefits (social security, unemployment, etc) may also be exempt.  The following items are generally considered non-exempt and will need to be relinquished during the bankruptcy proceedings:  stamp, coins, and other collections; family heirlooms; cash, stocks, bonds, and other investments; a second vehicle; a second or vacation home.

The important thing to remember with exemptions is that they will vary not only by state but on a case-by-case basis within the same state.  This is when having a very knowledgeable and experienced bankruptcy attorney comes into play.  The better your attorney is the better they will be able to apply the bankruptcy laws to your specific case.