Do I Get to Keep Some of My Property?

Do I Get to Keep Some of My Property?

When an individual files for bankruptcy, especially a Chapter 7, there is a concern that the debtor will lose all their property.

A debtor is allowed by law to retain certain property (called exemptions) under the bankruptcy code. Even more appealing is the fact that this property is able to remain free from liens and creditor claims. This only applies to unsecured creditors, meaning the property has not been given as collateral for a debt. Cars and homes typically are linked to the loan which purchased them. But much of the other debt, credit cards, and the like are not secured.

There are a whole host of exemptions on property. Idaho and the Federal Code have exemptions, but Idaho limits individuals filing for bankruptcy in Idaho to only Idaho exemptions. Many states require you to pick one or the other, but Idaho only gives you the state exemptions. (Having said that, some non-bankruptcy exemptions apply like wage garnishment caps and limitations for Social Security, Veterans, or Civil Service pensions, incomes, or benefits.)

Anything that falls within an exemption, you should not lose in bankruptcy. Notice there are limits on the amounts of some of the exemptions. If you have a car worth $15,000 (with a $7,000 exemption) you may lose your car and after the sale of it, be given back $7,000 to purchase a more modest car.

I list all the exemptions listed in Idaho Code as compiled by Best Case. These exemptions usually have a dollar amount to which property can be exempted. Anything over that amount can be lost or required to be given up in the bankruptcy. Now, there are some ways to get around and pigeonhole things, so it is very wise to have an attorney do the bankruptcy for you. But I think the list below will give you a good idea of where things fall. If you are seriously considering bankruptcy, give us a call and we can help you walk through some of the terrain.

Aggregate interest in unmatured life insurance contract for debtor or debtor’s dependent – $5,000 limit. Idaho Code 11-605(10)
Alimony, support, or separate maintenance-extent reasonably necessary for support. Idaho Code 11-604(1)(b)
Annuity contract proceeds – $1,250/month. Idaho Code 41-1836(1)(b)
Arms, uniforms of peace officer, national guardsman. Idaho Code 11-605(6)
Assistance benefits under federal, state or local law 100%. Idaho Code 11-603(4), Idaho Code 56-223
Benefits payable for medical, surgical or hospital care 100%. Idaho Code 11-603(4)
Burial plot for individual or family. Idaho Code 11-603(4)
Construction materials. Idaho Code 45-514
Crime victim’s compensation. Idaho Code 72-1020
Crops on 50 acres land – $1,000 limit. Idaho Code 11-605(7)
Death benefits if debtor was spouse or dependent of insured-extent reasonable necessary for support. Idaho Code 11-604(1)(d)
Disability Insurance. Idaho Code 41-1834
Disability or illness benefits – extent reasonably necessary for support. Idaho Code 11-604(1)(a), Idaho Code 41-1834
Disposable earnings not to exceed $1,500 in a calendar year – $1,500. Idaho Code 11-605(12)
Disable earnings – greater of 75% or 30X minimum wage. Idaho Code 11-207
Family portraits and heirlooms ($750 per item) (Aggregate exemption for all household furnishings, appliances, wearing apparel – $7,500 limit. Idaho Code 11-605(1)(c)
Federal social security or veterans benefits – 100% except support. Idaho Code 11-603(4)
Firearm (one) – $750 limit. Idaho Code 11-605(8)
Food or water provisions for 12 months. Idaho Code 11-605(4)
Fraternal benefit society benefits. Idaho Code 41-3218
Group insurance. Idaho Code 41-1835(1)
Health aids – reasonably necessary for health. Idaho Code 11-603(4)
Homestead – lesser of net value of lands, home & improvements – $100,000 limit. Idaho Code 55-1001, Idaho Code 55-1002, Idaho Code 55-1003
Household furnishings and appliances ($750 each) – $7,500 limit. Idaho Code 11-605(1)(a)
Individual unmatured life insurance contract, other than a credit life insurance contract. Idaho Code 11-605(9)
Jewelry – $1,000 limit. Idaho Code 11-605(2)
Life insurance. Idaho Code 41-1833(1), Idaho Code 41-1930
Liquor license. Idaho Code 23-514
Motor vehicle, one per person – $7,000 limit each. Idaho Code 11-605(3)
Personal injury or wrongful death claims – extent reasonably necessary for support. Idaho Code 11-604(1)(c)
Proceeds and assets from pension, annuity, retirement benefits, disability, death, and employee benefit plan. Idaho Code 11-604A
Proceeds from loss or destruction of exempt property traceable for 3 months. Idaho Code 11-606
Proceeds of sale: same as homestead – $100,000 limit. Idaho Code 11-1113
Qualified pension-profit-sharing plan. Idaho Code 55-1011, Idaho Code 11-604A
Real and personal property of courthouses, jails, schoolhouses and other public offices, buildings, lots. Idaho Code 11-605(5)
Retirement benefits – Policemen. Idaho Code 50-1517
Retirement benefits – Public employees. Idaho Code 59-1317, Idaho Code 59-1325
Retirement benefits – Firemen’s fund. – 100%. Idaho Code 72-1422
Specific partnership property. Idaho Code 53-3-307
State unemployed compensation. Idaho Code 11-603(4), Idaho Code 72-1375
Tools of trade: professional books – $2,500 limit. Idaho Code 11-605(3)
Water rights for land cultivated by debtor – 160 inches H2O. Idaho Code 11-605(7)
Wearing apparel, animals, books, and musical instruments ($750 per item) $7,500 limit. Idaho Code 11-605(1)(b)
Wildcard: aggregate interest in any tangible personal property – $800 limit. Idaho Code 11-605(11)
Workers’ compensation benefits. Idaho Code 72-802, Idaho Code 72-1375