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Lehighton & Carbon County Bankruptcy Exemptions

The primary purpose of bankruptcy law is to provide a consumer debtor with a fresh start. To permit the consumer debtor to start fresh going forward, bankruptcy law permits debtors to exempt certain property beyond the reach of their creditors. This ensures that debtors have some property going forward after their discharge.

Pennsylvania is unique in that consumer debtors can elect to take either the federal law exemptions or the state law exemptions. Pennsylvania law permits a limited exemption of marital property beyond the reach of individual creditors (not joint creditors). Most consumers utilize the federal law exemptions because it permits a greater dollar allowance of exemptions in personal property you own. Moreover, if you have lived somewhere other than Pennsylvania within 730 days before your bankruptcy petition, it could impact which state law exemptions you may claim.

Commonly utilized federal law exemptions by an individual debtor include the following, which are updated every other year to account for inflation:

(a) homestead (equity in a primary residence above and beyond secured liens/mortgages) in the amount of $22,975.00;

(b) equity in one motor vehicle in the amount of $3,675.00;

(c) household goods, furnishings, wearing apparel, appliances, books, animals, crops, or musical instruments in the total aggregate amount of $12,250.00;

(d) jewelry not to exceed an aggregate amount of $1,550.00;

(e) wildcard exemption in any property in the aggregate amount of $1,225.00 plus any amount not used in the homestead exemption up to $11,500.00;

(f) tools of the trade up to a total aggregate amount of $2,300.00;

(g) term life insurance;

(h) cash surrender value in one whole life insurance policy up to the amount of $12,250.00;

(i) right to receive disability, social security, or veteran’s benefits; and

(j) retirement funds to the extent those funds are held in a fund or account exempt from taxation.

The above list is not an exhaustive list of exemptions available to debtors who file a bankruptcy petition. Moreover, there are nuances under the law applicable to each of the above exemptions. Bankruptcy exemptions can prove to be difficult to properly employ in order to give you the most benefit of your fresh start. Attorney Weaver will explore in depth with you all of your assets to make sure you are electing the proper federal or state law exemptions in order to maximize the assets you may keep in order to receive your fresh start. Call for a consultation today at our Lehighton office in Carbon County, Pennsylvania.

Attorney Weaver’s bankruptcy practice includes serving clients in Carbon County, Schuylkill County, Monroe County, Luzerne County, Pike County, Lehigh County, Northampton County, and Berks County.

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