Chapter 7 bankruptcy can seem simple. You file for it, and if approved, most of your debt gets wiped out. Afterward, you have a clean slate and the only significant cost to your life is a big hit to your credit scores. You will be able to recover in time, but there’s something else you should be aware of when it comes to your Chapter 7 bankruptcy, and that’s exemptions. How do bankruptcy exemptions work in Georgia? Seymour and Associates has the answers you need.
What Are Bankruptcy Exemptions?
When you file for Chapter 7 bankruptcy, the appointed trustee will attempt to pay back as many of your creditors as possible. They do this by selling off assets of yours. However, there are assets that they can’t sell and these are known as exemptions. Each one has its own rules that we will go through below:
- Home Exemption—The homestead exemption in Georgia is $21,500 which is doubled if your spouse also has an interest in the home. This is used against your equity. If you are not using all of your homestead exemption, you can use up to $10,000 of the remainder to protect any other property.
- Car Exemption—You can exempt up to $5,000 of the value of your car.
- Jewelry Exmeption—In Georgia, jewelry has its own special exemption, and you can exempt up to $500 of jewelry.
- Tools of the Trade Exemption—If you have any trade tools including power tools, books, equipment, or anything else that is necessary for your profession, you can exempt up to $1,500 of the value.
- Other Exemptions—You can also exempt up to $5,000 worth of other items, though none of these items may be exempted for more than $300 individually. These items include animals, appliances, books, burial plots, clothing, crops, furnishings, health aids, household goods, and musical instruments.
As you can see, navigating your exemptions can be difficult, especially if you want to get the maximum benefit for yourself (and keep as much of your stuff as possible). This is where a skilled bankruptcy lawyer—like those we have at Seymour and Associates—will prove invaluable.
Read More: When Should You File for Bankruptcy?
Can You Use Federal Bankruptcy Exemptions in Georgia?
Georgia has its own laws and exemptions when it comes to bankruptcy. For starters, you have to have resided in Georgia for the last two years (730 days) in order to qualify at all. Some states that have their own exemptions allow you to choose between using the state exemptions or the federal exemptions during your Chapter 7 bankruptcy.
This is not the case in Georgia. If you are filing for Chapter 7 bankruptcy in Georgia, you have to use the state exemptions that we listed above. Typically though, they are more favorable than the federal exemptions anyway. The one exception to this is that you can use federal exemptions to protect certain disability benefits and retirement accounts.
Chapter 7 Bankruptcy Attorney in Augusta, GA
Are you considering Chapter 7 or Chapter 13 bankruptcy in the Augusta, GA area? Then Seymour & Associates is here to help. We can offer you a free consultation to assist you through this process. Do not hesitate to reach out. You’ll be glad you did.
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