A Comprehensive Overview of Georgia Bankruptcy Exemptions

If you’re worried about losing it all in bankruptcy, there are some protections granted to you. Georgia bankruptcy exemptions allow filers to keep some of their property to minimize the negative impacts of this option as much as possible.

Understanding Georgia Bankruptcy Exemptions

For debtors living in Georgia, filing for bankruptcy usually involves several considerations. One of the biggest concerns for married couples and individual debtors considering bankruptcy is whether they get to retain some of their assets. Understandably, many people want to know if they get to keep their personal property, home, or car.

Similar to most legal issues, the best way to find answers is by exploring the bankruptcy code and then discussing your options with a bankruptcy attorney. Each state usually has exemptions that could help one retain some of their assets, and bankruptcy in Georgia is no different.

However, while the exemptions are explicit, they can be confusing if you are filing for bankruptcy for the first time or are unfamiliar with the law. At the law offices of Bournakis & Mitchell, P.C., we always advise that before you head to bankruptcy court, you should contact an experienced bankruptcy lawyer to provide much-needed advice. 

Contact the best bankruptcy attorneys today, and we will provide the support and advice you need when filing for Chapter 7 or Chapter 13 bankruptcy. 

Filing for Bankruptcy Exemptions in Georgia

When filing for bankruptcy in Georgia, you need to know that there are both state and federal exemptions. The Georgia bankruptcy courts do not deal with federal exemptions. As such, if you are planning to file for bankruptcy in Georgia, you will have to argue your case under Georgia exemptions. 

One exception is that you can argue for federal exemptions to protect certain disability benefits and retirement accounts. 

 

Federal Bankruptcy Exemptions Georgia

Since Georgia does not allow one to file for bankruptcy exemptions except for a few specific cases, it is important to know these federal exemptions. 

While you are mostly limited to state exemptions when filing for bankruptcy in Georgia, if you have certain retirement accounts, you could be eligible for these exemptions. 

It is important to note that you will have to be a Georgia resident for 730 days (2 years) or more before you can file for the Georgia bankruptcy exemptions. Congress passed this law to prevent serial bankruptcy filers from moving to several states to take advantage of favorable exemptions. 

At Bournakis & Mitchell, P.C., our bankruptcy lawyer has the skill and experience to argue your case in court to ensure you get to claim as many exemptions as possible. Our bankruptcy attorneys are knowledgeable about bankruptcy law and how to navigate the Georgia bankruptcy courts to ensure favorable outcomes.

Bankruptcy Exemptions in the State of Georgia: The Homestead Exemption

Most people who seek the services of a bankruptcy attorney want to know if they are going to lose their home if they file bankruptcy in Georgia. 

Even though the prospect of having to move may be scary, it may be one of the most practical ways to get rid of nagging debt. Still, when you file bankruptcy in Georgia, you will be glad to learn that Georgia allows some homeowners to keep their homes under the homestead exemption. 

The homestead exemption allows for property exemptions of up to $43,000 for couples filing for bankruptcy together and up to $21,500 for a single person. The amount is usually applied against the equity that is held in the property.

For instance, if a married couple files for Chapter 7 bankruptcy while owning property worth $150,000, they will have to consider how much equity they have in the house. Anything less than $43,000 means that they qualify for the homestead exemption, and hence they could probably hold onto their property. 

If the equity in the house is greater than $43,000, the couple would need to sell the house before filing for bankruptcy. They will usually hold on to no more than $43,000, while anything left over from the sale would have to be distributed to creditors.

Are you about to file for bankruptcy in Georgia? It is critical to contact the lawyers at Bournakis & Mitchell, P.C. Our bankruptcy attorneys in Northwest Georgia will guide you through the process of filing for all manner of exemptions so that you get to keep your home while starting anew.

Georgia Exemptions for Bankruptcy: Motor Vehicle Exemption

Similar to a home, a vehicle is a critical asset to most modern families and individuals. Having a vehicle means that one can get to and from work and have the ability to go to medical appointments, job interviews, or the grocery store. 

Under Georgia bankruptcy laws, motor vehicle exemptions are capped at the equity of $5000. As such, a couple or individual that has no more than $5000 equity in a vehicle can keep it when they file for bankruptcy in Georgia. If they have more equity in the vehicle, they will have to sell the car and use any amount above $5000 to pay off creditors. 

It is important to note that while the wildcard exemption applies for motor vehicles, these two can be combined just like with home exemptions. For instance, a couple that uses $10,000 or less of the homestead exemption may use that money to save their car from bankruptcy processes.

If you intend to claim bankruptcy exemptions in Georgia, then you should call us today to help you out. Working with some of the best lawyers in the business, you can be confident that you will get help with anything from motor vehicle exemption, federal bankruptcy exemption, tools of trade exemption, and anything else you may qualify for.

Current Georgia Bankruptcy Exemptions

In addition to the homestead and motor vehicle exemptions, there are several other exemptions that Georgia bankruptcy laws make available to a filer. These include:

Wildcard Exemption

Under the wildcard exemption in Georgia, one can use up to $10,000 of unutilized equity money from a homestead exemption to claim another exemption. Moreover, the debtor gets up to $1200 to protect any other asset, which means they will have up to $11,200 to save other property.

 

Personal Property

No one wants to lose the beautiful painting that could fetch several thousands of dollars down the line or the great antique piano that has been in the family for three generations. However, when you file for bankruptcy, these are some considerations to take into account.

Georgia property exemptions are set at $5,000, which is quite generous for most debtors. Most people do not have personal items with a value greater than $5,000, and most do not have any resale value.

Still, some personal property books, furnishings, and household goods may fetch some reasonable prices on the open market. Moreover, each item is usually capped at $300.

As such, a baby grand piano may fetch $3,000, and while this is less than the $5,000 exemption, it is greater than $300 by $2,700, which means that it should be sold. However, since it may be impossible to get an accurate cash value for such personal property on the open markets, most bankruptcy filers usually get to retain possession.

You should note that jewelry as exempt property is capped at $500 rather than $300. Personal injury recoveries are capped at $10,000, while lost future earnings are capped at $7,500.

If you did not use the homestead exemption, your burial plot is protected by the personal property exemption. Home health aids necessary for support are also covered under the exemption no matter how much they may fetch on the open market.

 

Support Exemption

When you file bankruptcy under Georgia law, all alimony and child support proceeds assigned by the courts are protected.

 

Public Benefits Exemption

Persons that file bankruptcy in Georgia have the right to keep workers’ compensation and unemployment compensation. They can also keep their Social Security benefits under Georgia exemptions.

 

Wage Exemption

A debtor can keep up to 75% of their earnings, whether federal hourly minimum wage earnings or other unpaid weekly earnings. If the amount happens to be less than 40 times the state or federal hourly minimum wage, the minimum wage amount will be used over the 75 percent earnings mandate.

It is also important to note that bankruptcy courts can change wage exceptions for low-income debtors.

 

Tools of the Trade Exemption

For persons who rely on specific tools or equipment to earn their living, Georgia exemptions allow one to claim exemptions for equipment capped at $1,500. Tools of trade may include anything from saws, hammers, or even a laptop.

 

Insurance, Retirement and Pension Exemptions

Retirement accounts, including unmatured life insurance proceeds, 401(k), and IRAs, are usually exempted under Georgia bankruptcy law. These can typically be retained at total value regardless of whether you decide to file a Chapter 13 bankruptcy or Chapter 7 bankruptcy.

Nonetheless, it is critical to note that unmatured life insurance cash value is capped at $2,000, and the rest will have to be distributed to creditors.

 

What Are the Georgia Bankruptcy Exemptions?

Many people believe that filing bankruptcy will result in losing all of their personal property. However, nothing could be further from the truth as most people get to keep most of their property after filing bankruptcy.

Georgia bankruptcy exemptions allow one to protect some of their property depending on their value. A person that files a Chapter 7 bankruptcy will usually be looking to start over, and hence the bankruptcy courts will be understanding enough to acknowledge that you will need a car to go to work and a bed to sleep.

As such, the bankruptcy court will seek to ensure you have a basic standard of living after you file bankruptcy. In essence, bankruptcy law intends to be fair by allowing one to keep their essentials and earnings needed for support while preventing others from keeping luxury items such as furs, jewelry, and diamonds that they can live without.

Speaking with a professional bankruptcy attorney is one of the most important steps you can take before going to the bankruptcy court. Bournakis & Mitchell is one of the best bankruptcy law firms that can help you understand any state and federal bankruptcy exemption that may apply in your case.

Georgia Bankruptcy Laws

Before you look into Georgia bankruptcy exemptions, it is critical to understand Georgia’s governing bankruptcy laws. The primary laws governing bankruptcy are the Bankruptcy Code and the Georgia Code. The major areas of the law that you need to consider are the Chapter 7 bankruptcy and the Chapter 13 bankruptcy.

Exemptions tend to be critical for people that intend to file bankruptcy under Chapter 7  bankruptcy. Under Chapter 7 bankruptcy, you will need to liquidate as many of your assets as possible which means more exemptions could apply.

On the other hand, Chapter 13 bankruptcy requires more of a rearrangement of what a debtor owes. Nonetheless, even if you are filing Chapter 13 bankruptcy, it is critical to understand state and federal exemptions that may apply.

For this reason, you will need to hire the services of Chapter 7 bankruptcy lawyers if you are going to court. A lawyer knows the process and will help you navigate the court systems and get you the most favorable outcomes.

When Did Georgia Amend Bankruptcy Exemptions Laws?

Georgia amended the Bankruptcy exemption laws in 2015 to allow individual debtors to exempt personal, real, and intangible property from other properties in the debtor’s estate. Under Georgia law, exempt assets are protected from being liquidated and distributed to creditors. These exemptions are to be found in the Georgia Code section 44-13-100.

Deciding what assets are exempt is a complicated business, so you need a skilled attorney’s services to guide you through the process. The lawyers at Bournakis & Mitchell, P.C. have the necessary background to assist you, having worked with hundreds of clients navigating the bankruptcy court process. Contact us today for a first free consultation on how to file for bankruptcy in Georgia while keeping as much of your property as you should.

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