Worrying about what will happen to your possessions is natural when filing for bankruptcy. But there’s good news: you can keep important things, such as your personal treasures and the retirement funds you’ve saved. Here’s a list of what’s yours to keep:
Personal Items
You can keep personal items worth up to $5,000, including your wardrobe, books, and work tools. However, this doesn’t include items you want to sell or rent out. You can also keep household items worth up to $1,000, such as your couch, fridge, and pets.
Emergency and Health Funds
Any money you’re supposed to get because of sickness, accidents, or someone’s death is safe from legal claims. This includes insurance money or payments ordered by the court. You can also keep essential medical items, like wheelchairs or hearing aids. However, this may not include any disability benefits meant for daily expenses.
Domestic Support Obligations
These refer to various forms of financial support that one family member is legally obligated to provide you. It includes:
Bankruptcy laws protect this income to ensure you can continue to cover your essential living costs.
Wildcard Exemption
As its name suggests, it applies to various assets and gives you some control over which belongings you want to keep. Specifically, you can safeguard up to $6,000 in cash or other assets. However, you need to make this decision within 30 days after your bankruptcy starts.
Marital Trust Property
If your spouse has debts, the people they owe cannot go after trust assets meant for both of you. Any trust items that are supposed to help both spouses are usually safe from your partner’s creditors. This rule helps protect the spouse without debts from losing out because of the other’s financial troubles.
Bankruptcy Doesn’t Have to Define Your Future
Filing for bankruptcy is more than just numbers – it’s about your life, family, and future. You have rights that can help safeguard what matters most to you. Contact Maronick Law for help with a Chapter 7 bankruptcy attorney.