In a bankruptcy, how do you know what exemptions can be accepted?

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In a bankruptcy, how do you know what exemptions can be accepted?

I amended my bankruptcy because the trustee was taking my tax returns. The trustee is rejecting my exemptions.

Asked on February 24, 2012 under Bankruptcy Law, Illinois

Answers:

S.L,. Member, California Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

There are two sets of exemptions.  One set is the federal exemptions and the other is the state exemptions.  You cannot combine federal and state exemptions.  You have to select either all federal or all state exemptions for your bankruptcy.  Choose either federal or state exemptions depending on which set of exemptions provides the broadest coverage for your particular situation as the exemption amounts vary whether it is a state exemption or a federal exemption.

Once you have selected either federal or state, then you use the categories that apply to your particular situation.  For example, if you own a home, select the homestead exemption.  If you own a car, select the automobile exemption.  Select exemptions for household goods and furnishings, clothing, etc. depending on which exemptions are applicable to your situation.  There is also a catch-all exemption which can be used towards unused amounts of various exemptions. 


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