Under bankruptcy, some property is exempt from the bankruptcy, which can vary from state to state. Property that is not exempt can be sold by the bankruptcy trustee to pay off creditors.
If you have questions regarding what property is exempt in the state of Illinois it is important to consult a local bankruptcy attorney for up to date information as exemptions amounts can change.
Common exemptions include a certain amount of equity in a home – the homestead exemption – that doubles for married filers. An Illinois motor vehicle exemption is also available and can protect a certain amount of equity in a vehicle. A wild card exemption can protect property of a filer’s choosing other than real estate. Fortunately, most tax exempt pensions and retirement accounts are exempt in a bankruptcy.
Of course, the type of bankruptcy chosen also factors into the property a filer can keep. Someone who files chapter 7 bankruptcy can expect all nonexempt property to be sold to pay creditors in exchange for discharge of debt. Alternatively, filers who file a chapter 13 bankruptcy repayment plan may be able to keep more of their property by entering into an affordable payment plan administered by the trustee.
Individuals and couples considering bankruptcy to solve a difficult financial situation should discuss their financial goals with an experienced bankruptcy attorney who can advise them whether bankruptcy protection is a good strategy to achieve their financial goals. Contact Charles E Covey for more information today.