Chapter 7 bankruptcy is also known as liquidation bankruptcy. It uses a debtor’s non-exempt assets to pay creditors, and the debtor can avoid having to create a repayment plan. While giving up a property to pay debts may seem like a poor alternative, the bankruptcy exemptions allowed in New York offer exemptions that allow debtors to hold onto some of their property. Depending on the situation, the debtor may not have to give up any property at all because the debtor’s property may be fully protected by the available exemptions.
New York’s Chapter 7 Bankruptcy Exemptions
In New York, debtors have the choice of using either Federal bankruptcy exemptions or the New York State bankruptcy exemptions. While the Federal bankruptcy exemptions offer certain benefits to debtors filing for Chapter 7, including a fairly large “wildcard” exemption, the New York State exemptions offer different set exemptions, which if chosen, may be more beneficial to a debtor’s situation such as a much larger homestead exemption. However, you must choose between the state or the federal exemptions. You cannot combine exemptions from both. A bankruptcy attorney such as Natasha Meruelo, Attorney at Law, can assist you with choosing the best set of exemptions to help you protect the assets that may be most important to you.
Assets you may be able to keep include:
- Your vehicle
- Your house
- Your retirement proceeds
- Your life insurance with cash surrender value
- Money in the bank
- Your personal property
New York, as well as the federal government, imposes financial limits on the amount that you may keep in each category. In addition, there is a wildcard exemption that you may be eligible for, which would apply to any property item of your choice, up to a certain dollar value. If you are filing with a spouse, the number of exemptions may be doubled. There are certain issues to be on the lookout for, which can affect what exemptions you may be able to apply to your case. For example, you should inform your attorney if you have recently moved to New York from another state or recently purchased your home.
Bankruptcy Exemptions Chart for New York
| Assets | Exemption Amount | Notes |
|---|---|---|
| Cash | $5000 | Not available if using Homestead Exemption |
Homestead | $150,000 for Richmond, Kings, Queens, New York, Bronx, Nassau, Suffolk, Westchester, Rockland, Putnam; $125,000 for Dutchess, Ulster, Orange, Columbia, Albany, Saratoga; $75,000 all other counties | N/A |
Vehicles | $4000, or $10,000 if equipped for disability | One per debtor |
New York State College Choice Tuition Savings Program Trust Fund | Variable | Dependent on fund type and designation |
Personal Property | $10,000 | Only available if not using a Homestead Exemption |
Pension/Retirement Benefits | Variable | Determined on a case by case basis |
Wild Card for Personal Property/Bank Accounts/Cash | $1000 | Only available if no Homestead Exemption claimed |
Cemetery | Completely Exempt | N/A |
Future Earnings | Variable | Determined on a case by case basis |
Health Aids | Completely Exempt | N/A |
Insurance - Annuity | Typically exempt, annuities purchased within 6 months of filing limited to $10,000 | N/A |
Insurance - Disability | Completely Exempt | N/A |
Insurance - Life | Completely Exempt | N/A |
Social Security | Completely Exempt | N/A |
Security Deposits | Completely Exempt | N/A |
Public Assistance | Completely Exempt | N/A |
Property in a Partnership | Exempt | N/A |
Trusts | Completely Exempt | N/A |
Trust Funds | 90% Exempt | N/A |
Unemployment | Completely Exempt | N/A |
Veterans' Benefits | Completely Exempt | N/A |
Wages | 90% Exempt | Includes earnings received within 60 days before or any time after Sheriff's income execution |
Wage - Armed Forces | Completely Exempt | N/A |
Worker's Compensation | Completely Exempt | N/A |
Crime Victim Compensation | Exempt | N/A |
Injury Compensation | $7500, not including pain and suffering or pecuniary loss | N/A |
Wrongful Death Compensation | Variable | Determined on a case by case basis |
Divorce Compensation | Variable | Determined on a case by case basis |
Discuss Your Options for Filing Chapter 7 Bankruptcy – Call Today at (914) 752-5098
Natasha Meruelo, Attorney at Law guides clients through the New York bankruptcy process. If you are filing for Chapter 7 bankruptcy and want to know your options, I can analyze your situation and answer your questions. As a White Plains bankruptcy attorney with nearly a decade of legal experience, I will work hard on your behalf as you seek financial stability.
Contact my firm today to request a free initial consultation.
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