Bankruptcy Filing Tips

The property, exemptions and the Trustee

In a bankruptcy case to Chapter 7, all non-exempt assets can be sold to satisfy creditors. The question that arises is simply what is not exempt from the property? This question can be answered with generalities. Instead of this, the answer depends on the jurisdiction the case is closed and that the exemptions are available to a debtor. In some cases the federal exemptions apply. In other cases, the exemptions that apply state. Finally, in other cases, state or federal exemptions may apply.

For example, in the State of Wisconsin, the debtor may choose the law of demand for exemption. By assets in question, the federal exemptions may offer more protection to the debtor. In other situations, the State may derogate protection. In states such as Illinois, the federal exemptions are not used. The debtor of the State of Illinois can use the exemptions of the state.

A brief look at the exemptions in Illinois is as follows:

15000.00 U.S. dollars in real estate by the debtor;

$ 2,400.00 on a motor vehicle on the debtor;

$ 4,000.00 in miscellaneous goods by the debtor;

All the necessary clothing of a debtor;

All the benefits of a qualified Erisa pension debtor;

All support of a debtor and receipts for child support.

So you can see that there are relatively high protection in Illinois. Only beyond amounts of the exemptions that can be taken by the Chapter 7 trustee, sold and used to pay creditors in accordance with the schedule of payments for the code bankruptcy.

Moreover, just before crossing the exemption amount does not mean that the president will try to administer the estate. The Trust has a cost associated with asset management. He or she wants to be sure there will be a decent return paid to unsecured creditors. Otherwise the whole exercise is simply a waste of time and burden on the debtor. Each director is different, and each case is different. Never assume that the property be taken or not. Consult a bankruptcy attorney with experience in gain a better understanding of exceptions allowed in each category.

A special note for all professionals in the bankruptcy: If you know that an asset is potentially at risk and have advised his client that his client sign a receipt of potential assets. Thus, the client can not declare that he was unaware that the property could be taken by the administrator.

About the Author

David M. Siegel is the author of Chapter 7 Success: The Complete Guide to Surviving Personal Bankruptcy. He is a member of the American Bankruptcy Institute and currently practices bankruptcy law in Chicago and its surrounding suburbs. Additional information is available at Chapter 7 Bankruptcy.

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