Section 522(d) of the Bankruptcy Code provides for Exemptions from the bankruptcy Estate, and use of these provisions is a way to keep some assets in the possession of the Debtor. A person filing for bankruptcy should be aware of “exemptions” in planning for bankruptcy and in planning what will be available to them when they receive their fresh start through Discharge. An important point to remember for a couple, is that these exemptions may be doubled if both spouses file.

With an automobile, the debtor may exempt $2,950.00 of their equity in a single vehicle in a Chapter 7. Household items and jewelry may be exempted in the amounts of $9,850.00 and $1,225.00, respectively. The filer should know that these amounts do not represent the dollar amounts that were paid initially for the items but rather the depreciated present day value of the materials as of the date of filing.

Perhaps the most important exemption item to many filers is the amount of money which can be exempted from the bankruptcy estate for a person’s home. 11 U.S.C. §522(d)(1) allows up to $18,450.00 of the debtors interest in their home. The exemption may also be claimed for equity in a dependent’s home which is actually owned by the bankruptcy filer.

The law allows that a value up to $1,850.00 for tools of the trade of a debtor or a dependent is exempt from the bankruptcy estate.

Social security, unemployment compensation, veterans benefits as well as public assistance are also exempt. The receipt of alimony, separate maintenance or support payments are exempt but that exemption is limited to the dollar amount which is necessary for the support of the debtor or the dependent.

Depending on the age and work history of the debtor, retirement funds may be an important exclusion from the bankruptcy estate. The fund from a variety of retirement accounts, including IRA’s, are exempt from the bankruptcy estate, however, there is a limit of $1 million of such funds which may be exempted. Therefore, depending upon the person’s situation, they may elect state law exemptions rather than federal depending upon the dollar values for house or IRA. In some cases the state exemptions may be more generous to the debtor.