Chapter 7 Bankruptcy Exemptions In Louisiana
In Chapter 7 bankruptcy, your debts are discharged after nonexempt property is seized, liquidated and distributed amongst your creditors to pay back some, or all, of your debts. While forfeiting property is difficult, it’s important to understand the means to the end. First, the process only usually takes a total of four to six months to complete. What’s more, while some property will be seized, you likely have a decent amount of property that can be exempt.
While under Chapter 7 bankruptcy, you must forfeit nonexempt property. However, there are a verity of exemptions, including:
- Homestead exemption
- Motor vehicle exemption
- Benefits exemptions
- Wage exemptions
- Property exemptions
- Miscellaneous exemptions
General Bankruptcy Exemption Notes
Before briefly exploring the different bankruptcy exemptions in Louisiana, there are a few things to note. First, in Louisiana, bankruptcy exemptions are exclusively determined by the state’s laws, not the federal bankruptcy law. And while bankruptcy exemptions can be extremely beneficial, they’re not something to try to take advantage of.
For one, improperly filing bankruptcy exemptions could backfire, causing you to pay for or lose what you were claiming as exempt. What’s more, your bankruptcy trustee has the power to make objections, which they will do if they notice something suspicious.
In fact, intentionally filing false information and trying to exploit the exemption system could result in bankruptcy fraud, something you do not want to undergo.
Finally, every bankruptcy case is different, and you may have special exemption qualifications – or disqualifications – that we don’t discuss here today.
With the assistance of expert bankruptcy attorneys, you can rest assured that every aspect of your bankruptcy filing and case is being properly completed, thoroughly explored and effectively navigated. We can help determine not only which exemptions you’re eligible for, but also what type of bankruptcy you’re eligible for, other potential options and so much more.
If you’re considering bankruptcy in Louisiana, don’t stress. Instead, enlist the top-rated bankruptcy law firm in the state. The Cook Law Firm is comprised of experienced, successful attorneys who are here to serve you.
Louisiana’s homestead exemption is designed to protect your home and land, and it’s automatically included in the Chapter 7 process. In essence, this exemption will protect your home and land’s equity up to $35,000. That said, this exemption differs for those who live in the city and for those who live outside of metropolitan zones.
For folks in the city, the exemption applies for up to five acres of property, and 200 acres for people outside of the city. Finally, there are certain circumstances that allow one’s full home value to be exempt. Connect with our attorneys to learn more!
Motor Vehicle Exemption
In general, Louisiana residents are able to exempt up to $7,500 of the value of one vehicle. You are additionally allowed to exempt up to another $7,500 if you have another vehicle outfitted to assist someone who has a disability.
Many benefits are eligible for exemption under Chapter 7 bankruptcy. Certain insurance benefits can qualify for exemption when you file – for instance, some life insurance benefits or insurance payouts that were issued as a result of natural disaster-induced property damage inflicted to your exempt property.
Benefits including retirement, pensions, annuity contacts and tax-deferred arrangements are all potentially eligible for exemption as well. As we’ve mentioned above, bankruptcy will look a little different for everyone who undergoes it. Especially with benefits, there are a lot of criteria that dictate whether or not each case will qualify for exemption such as your job type. This is why it’s best to consult with our bankruptcy experts to have an understanding of which benefit exemptions you’ll qualify for.
When it comes to your wages, you’re actually able to exempt either 30 times more than the minimum wage or 75% of your disposable income, whichever is applicable to your situation.
A considerable amount of personal property is exempt during Chapter 7 bankruptcy. Belongings like furniture, family portraits, kitchen utensils, household goods, musical instruments, pets and other animals are exempt. In addition to these general exemptions, Louisiana also allows up to $2,500 worth of guns and ammunition as well as up to $5,000 dollar wedding rings to be eligible for exemption.
So far, we’ve only scratched the surface of what exemptions are possible in the state of Louisiana. And in our eyes, this just goes to show just how much this system is intended to help people. While there’s no doubt that you’ll have to forfeit a considerable amount of property, bankruptcy won’t leave you high and dry. Instead, it’ll help provide you with a new financial start.
Some of the notable miscellaneous exemptions include:
- COVID-19 Relief Check Exemption
- Unemployment Compensation Exemption
- Payment To Crime Victim Exemption
- Public Assistance Exemption
- And more
Contact The Cook Law Firm
When it comes to bankruptcy, there are so many moving parts and legal processes that need to be navigated. Determining and properly filing for Chapter 7 bankruptcy exemptions is only one piece of the puzzle. That said, making the most out of exemptions that apply to your case can truly be a gamechanger in the long term.
Whether it’s managing bankruptcy exemptions, filing paperwork with the bankruptcy court or advocating on your behalf in hearings, a bankruptcy attorney is the key to a successful, efficient, problem-free bankruptcy experience.
In Louisiana, The Cook Law Firm proudly provides incredible bankruptcy attorneys to our neighbors. With years of experience and an impeccable track record, our firm gets results. Not only that, but we help ease the burden, stress and anxiety bankruptcy can bring – especially compared to trying to manage bankruptcy on your own.