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Exemptions: Protecting Your Real & Personal Property in Bankruptcy

by on 1/9/2013

Filing for bankruptcy is a great legal tool used to assist people who have fallen on tough financial times. There are many intricacies involved in bankruptcy that you should discuss with a knowledgeable attorney, none more important than exemptions. Exemptions determine what property (i.e. home, car, retirement accounts, cash-on-hand, etc.) you may keep in a Chapter 7 bankruptcy and are one of the mechanisms used to determine how much you must pay to certain creditors in a Chapter 13 bankruptcy. When you “exempt” a particular piece of property, you are essentially protecting it from being liquidated by your bankruptcy trustee to pay back your creditors. The attorneys at Bankruptcy Law Group can help you maximize the amount of real and personal property you are allowed to retain when filing for bankruptcy.

Bankruptcy Exemptions

Each state has different exemption laws and depending on which state you reside in, the exemptions that you use could vary greatly. Nevada has one set of laws that you must use if you are a Nevada resident. However, California is unique among the 50 states in that it has two sets of exemptions that you may use when filing for either a Chapter 7 or Chapter 13 bankruptcy, each providing its own set of advantages.  For example, if your primary residence has $50,000.00 of equity in it and you reside in California, you may opt to use the 704 exemptions in order to save your home. However, if you live in California and do not own a home but rather have $5,000.00 in a checking account, own a car outright that is valued at $7,500.00, and own a boat valued at $10,000.00, you may opt to use the 703 exemptions in order to save your personal property.

If you are considering filing for bankruptcy, it is crucial to understand how exemptions work and learn what property is exempt in your particular state. The laws governing exemptions are complex and frequently change. To ensure you are getting the most complete and current information, feel free to contact our attorneys at Bankruptcy Law Group. Our attorneys welcome the opportunity to meet with you and provide you specific information that applies to your situation.

Below please find a list of common exemptions used in both California and Nevada.

California – 703 Exemptions

Code Property Maximum Amount Allowed to Exempt
CA CCP § 703.140(b)(2) Motor Vehicle $3,525.00
CA CCP § 703.140(b)(3) Household Goods $550.00 per item
CA CCP § 703.140(b)(4) Jewelry $1,425.00
CA CCP § 703.140(b)(6) Books; Tools of Trade $2,200.00
CA CCP § 703.140(b)(8) Unmatured Life Insurance $11,080.00
CA CCP § 703.140(b)(11)(D) Personal Injury benefits (not including pain & suffering) $22,075.00
CA CCP § 703.140(b)(1) & (5) WILDCARD $23,250.00

California – 704 Exemptions

Code Property Maximum Amount Allowed to Exempt
CA CCP § 704.010 Motor Vehicle $2,725.00
CA CCP § 704.040 Jewelry; Heirlooms; Art $7,175.00
CA CCP § 704.060 Prop. Used in Debtor’s Trade $7,175.00
CA CCP § 704.100 Unmatured Life Insurance $11,475.00
CA CCP § 704.730 Primary Residence $75,000.00 for Single Debtor; $100,000.00 for a Family Unit; $175,000.00 if 65+ yrs. Old or physically or mentally disabled


Code Property Maximum Amount Allowed to Exempt
NRS 21.090(1)(m) Real Prop. or Mobile Home $550,000.00
NRS 21.090(1)(f) Motor Vehicle $15,000.00
NRS 21.090(1)(a) Jewelry; Art $5,000.00
NRS 21.090(1(d) Tools of Trade $10,000.00
NRS 21.090(1)(g) Wages Greater of 75% of weekly disposable earnings of 50x minimum hourly wage
NRS 21.090(1)(u) Personal Injury Benefits $16,150.00

This is not an exhaustive list. Refer directly to the state code for a more detailed analysis and for any amended codes.

Want to make sure you maximize all your possible exemptions? Schedule a free consultation with a licensed bankruptcy attorney today.