What Do I Get to Keep if I File for Chapter 7 Bankruptcy Protection?

In all Chapter 7 bankruptcy filings the debtor will file a schedule of "exempt" property. Federal bankruptcy law allows an individual debtor to protect certain property from the claims of creditors, by way of federal or state exemptions. See Declaration of Homestead Bankruptcy Exemption section below.

In California, there are two systems. Before Chapter 7 bankruptcy, you should consult with bankruptcy lawyers in California to determine which system is best for your situation. A brief review of the two systems is contained below. Please note that this is intended only as a guide, and is subject to change. Please consult CA bankruptcy lawyers to assist you in choosing the correct exemptions for you. They can help you decide whether to proceed with a declaration of the homestead bankruptcy exemption.

ASSET	EXEMPTION	LAW PROVISION
HOMESTEAD	Real or personal property you occupy including mobile home, boat, stock cooperative, community apartment, planned development or condo to $50,000 if single and not disabled; $75,000 for families if no other member has a homestead (if only one spouse files, may exempt one-half of amount if home held as community property and all of amount if home held as tenants in common),$100,000 if 65 or older, or physically or mentally disabled; $100,000 if 55 or older, single and earn under $15,000 or married and earn under $20,000 and creditors seek to force the sale of your home; sale proceeds exempt for 6 months after received (husband and wife may not double).
PERSONAL PROPERTY	Appliances, furnishings, clothing and food needed	704.02
	Bank deposits from Social Security Administration to $2000 ($3000 for husband and wife)	704.08
	Building materials to $2000 to repair or improve home (husband and wife may not double)	704.03
	Burial plot	704.2
	Health aids	704.05
	Jewelry, heirlooms and art to $5000 total (husband and wife may not double)	704.04
	Motor vehicles to $1900, or $1900 in auto insurance if vehicle(s), lost, damaged or destroyed (husband and wife may not double)	704.01
	Personal injury and wrongful death causes of action	704.140 (a), 704.150 (a)
	Personal injury and wrongful death recoveries needed for support; if receiving installments, at least 75%	704.140(b), (c), (d), 704.150 (b), (c)
	May file homestead declaration	704.92
INSURANCE	Disability or health benefits	704.13
	Fidelity bonds	Labor 404
	Fraternal unemployment benefits	704.12
	Homeowner's insurance proceeds for 6 months after received, to homestead exemption amount	704.720 (b)
	Life Insurance proceeds if clause prohibits proceeds from being used to pay beneficiary's creditors	Ins. 10132, Ins. 10170, Ins. 10171
	Matured life insurance benefits needed for support	704.100 (c)
	Unmatured life insurance policy loan value to $8,000 (husband and wife may double	704.100 (b)
MISCELLANEOUS	Business or professional licenses	695.06
	Inmates' trust fund to $1000 (husband and wife may not double)	704.09
	Property of business partnership	Corp. 15025
PENSIONS	County employees	Gov't 31452
	County firefighters	Gov't 32210
	County peace officers	Gov't 31913
	Private retirement benefits, including IRAs and Keoghs	704.115
	Public employees	Gov't 21201
	Public retirement benefits	704.11
PUBLIC BENEFITS	Aid to blind, aged, disabled, AFDC	704.17
	Financial aid to students	704.19
	Relocation benefits	704.18
	Unemployment benefits	704.12
	Union benefits due to labor dispute	704.120(b)(5)
	Workers' compensation	704.16
TOOLS OF TRADE	Tools, implements, materials, instruments, uniforms, books, furnishings, equipment, vessel, motor vehicle to $5,000 total; to $10,000 total if used by both spouses in same occupation (cannot claim motor vehicle under tools of trade exemption if claimed under motor vehicle exemption)	704.06
WAGES	Minimum 75% of wages	704.07
	Public employees vacation credits; if receiving installments, at least 75%	704.113
SYSTEM 2 NOTE: Married couples may not double any exemptions (se In re Talmadge, 822 F.2d 1120 (9th Cir. 1987); In re Baldwin, 70 B.R. 612 (9th Cir. B.A.P. 1987))
ASSET	EXEMPTION	LAW PROVISION
HOMESTEAD	Real or personal property, including co-op, used as residence to $15,000; unused portion of homestead may be applied to any property	703.140 (b)(1)
PERSONAL PROPERTY	Animals, crops, appliances, furnishings, household goods, books, musical instruments and clothing to $400 per item	703.140 (b) (3)
	Burial plot to $15,000, in lieu of homestead	703.140 (b) (1)
	Health aids	703.140 (b) (9)
	Jewelry to $1,000	703.140 (b) (4)
	Motor vehicle to $2,400	703.140 (b)(2)
	Personal injury recoveries to $15,000 (not to include pain and suffering; pecuniary loss)	703.140 (b) (11) (D, E)
	Wrongful death recoveries needed for support	703.140 (b) (11) (B)
INSURANCE	Disability benefits	703.140 (b) (10)() (C)
	Life insurance proceeds needed for support of family	703.140 (b) (11) (C)
	Unmatured life insurance contract accrued avails to $8,000	703.140 (b) (8)
	Unmatured life insurance policy other than credit	703.140 (b) (7)
MISCELLANEOUS	Alimony, child support needed for support	703.140 (b) (10) (D)
PENSIONS	ERISA-qualified benefits needed for support	703.140 (b) (10) (E)
PUBLIC BENEFITS	Crime victim's compensation	703.140 (b) (11) (A)
	Public Assistance	703.140 (b) (10) (A)
	Social Security	703.1400 (b) (10) (A)
	Unemployment compensation	703.140 (b) (10) (A)
	Veterans' benefits	703.140 (b) (10) (B)
TOOLS OF TRADE	Implements, books, and tools of trade up to $1,500	703.140 (b) (6)
WAGES	NONE
WILD CARD	$800 of any property	703.140 (b) (5)
	Unused portion of homestead or burial exemption, of any property	703.140 (b) (5)

Special Note: Under the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (S.256), signed by President Bush on April 20, 2005, debtors may elect state exemptions in the state in which they have lived for the 730 days prior to the bankruptcy. If they have moved during that 730-day period, the state exemptions are those for the state in which they lived the majority of the time for the 180 days before the 730-day period.

Declaration of Homestead Bankruptcy Exemption

Regardless of the level of state exemptions, the debtor may only exempt up to $125,000 of interest in a homestead that was acquired within the 1,215 day period prior to the filing. The calculation of that amount does not include any equity that has been rolled over during that period from one house to another within the same state. (For those who have violated securities laws of engaged in certain criminal conduct, the cap is $125,000, notwithstanding a higher State law allowance).

To the extent the homestead was obtained through fraudulent conversion of nonexempt assets during the 10-year period before the Chapter 7 bankruptcy filing, the exemption is reduced by the amount attributed to the fraud. Please consult CA bankruptcy lawyers for more information on the declaration of homestead bankruptcy exemptions.