When the U.S. Supreme Court recently posted its decision on the Schwab vs. Reilly case, it cleared up what had been a very technical question regarding bankruptcy exemptions. The Court stated that, "a debtor must indicate that they are claiming an exemption for the full value of the item not just a portion of it." By making such a case, the Supreme Court is helping those who file bankruptcy make sure they are protecting all of their assets when they are eligible.
Bankruptcy Offers You a Clean Start
Once discharged in bankruptcy, most of your debts will be wiped away giving you freedom from lingering debt or nagging creditors. Bankruptcy comes at a price, however, as some of your property and assets may be sold or taken from you in order to pay off your debts. But, as a matter of government policy,you won't lose everything.
The law recognizes that you still need basic possessions to get a fresh start. The Bankruptcy Code recognizes these basic needs and gives you property exemptions. Exempting these items means that they are being protected from the bankruptcy estate and cannot be used by the bank to pay off your debts. Most people in Tennessee are able to use these exemptions to protect almost everything.
What's Exempt in Tennessee?
Although the federal bankruptcy code provides exemptions for assets in many states, the legislature in Tennessee has decided not to utilize the federal bankruptcy exemptions. Instead, they have created their own laws that set the type and amount of property you may protect.
In the state of Tennessee you are able to claim a portion of the equity in your home. The amount of equity you can protect depends upon your age, single or married status and whether dependent children under age 18 live in the household. A personal property exemption of $10,000 for each adult filing a bankruptcy petition includes personal items, money deposited in a bank or other financial institution, furniture, appliances, vehicle equity and all other personal items except clothing, containers that the clothing is in, certain books and other miscellaneous personal possessions. You may also claim tools of trade up to $1,900 in value. A word of caution - there are limits to the value of the items you may exempt. To be certain of what you may keep in a bankruptcy, you may want to speak with an experienced Nashville bankruptcy lawyer.
Navigating through bankruptcy laws can be confusing. What is worse, a misstep could result in your case being dismissed or being forced to surrender a valuable asset. Because the laws are so precise and each individual's situation is unique, it is important to have advice you can trust. A Tennessee bankruptcy attorney can review your situation with you and discuss your options.
If you face overwhelming debt and have questions about how bankruptcy can help you, contact a Nashville bankruptcy lawyer. He or she will be able to walk you through each and every step of the bankruptcy process to see if it is the best route for you.
