Understanding Nonexempt Property in Bankruptcy
If you are about to file for bankruptcy, it is crucial that you know what things can possibly happen. One of the two things might happen: either you will lose your property or pay to keep them. So, the question is, what is nonexempt property in bankruptcy? In this article, with the help of an experienced bankruptcy attorney, you will gain a deeper understanding of these important aspects of bankruptcy.
Jeppson Law Office is the right bankruptcy law firm for you. If you have any questions or are confused about bankruptcy, our experienced bankruptcy attorney is here for you. We understand that some legal situations are very complex for the average individual to comprehend. That’s why our legal team will do whatever it takes to help you achieve the financial freedom you desire. Get a free initial consultation now!
What is Nonexempt Property in Kansas City, MO?
Nonexempt property is property that can be taken by a bankruptcy trustee to pay your creditors. Here are some additional details about the nonexempt property in Kansas City, Missouri:
- The homestead exemption is the most important exemption in Kansas City, Missouri. It protects the equity in your home up to $15,000. If you have equity in your home that exceeds $15,000, you may be able to protect some of it by filing for Chapter 13 bankruptcy.
- The personal property exemption protects certain personal belongings, such as furniture, appliances, and clothing. The amount of the personal property exemption in Kansas City, Missouri is $3,000.
- The retirement accounts exemption protects retirement accounts, such as IRAs and 401(k)s. The amount of the retirement accounts exemption in Kansas City, Missouri is up to $1,225,000 for married couples filing jointly and $612,000 for individuals.
- The life insurance exemption protects life insurance policies. The amount of the life insurance exemption in Kansas City, Missouri is up to $12,250 for the face value of the policy.
- The wages exemption protects a portion of your wages from being taken by creditors. The amount of the wage exemption in Kansas City, Missouri is up to 75% of your disposable income.
- The Social Security benefits exemption protects Social Security benefits from being taken by creditors.
- The public assistance benefits exemption protects public assistance benefits, such as food stamps and welfare, from being taken by creditors.
If you have any questions about nonexempt property in Kansas City, Missouri, you should speak with an experienced bankruptcy attorney.
What is the Role of Nonexempt Property in Chapter 7 Bankruptcy?
The role of nonexempt property in Chapter 7 bankruptcy is to help the debtor discharge their debts. By selling the debtor’s nonexempt property, the trustee can generate cash to pay off the debtor’s unsecured creditors. This allows the debtor to start over with a clean slate, free from debt.
The amount of property that a debtor can exempt in Kansas and Missouri varies depending on the type of property and the debtor’s circumstances. For example, a debtor can exempt up to $15,000 in equity in their home, $3,000 in equity in their car, and $4,000 in personal property.
If you are considering filing for Chapter 7 bankruptcy in Kansas or Missouri, it is important to speak with an experienced bankruptcy attorney to discuss your nonexempt property. The attorney can help you understand your options and protect your rights.
Here are some specific examples of nonexempt property in Kansas and Missouri:
- Cash and investments
- Vacation homes
- Second cars
- Retirement accounts (if the debtor is not married)
- Life insurance policies (if the debtor is not married)
What is the Role of Nonexempt Property in Chapter 13 Bankruptcy?
The role of nonexempt property in Chapter 13 bankruptcy is different from its role in Chapter 7 bankruptcy. In Chapter 13 bankruptcy, the debtor does not lose their nonexempt property. Instead, the debtor must pay the value of their nonexempt property to their creditors over the course of their repayment plan.
The amount of nonexempt property that a debtor must pay to their creditors is determined by their disposable income. Disposable income is the amount of money that a debtor has left after paying for their living expenses. The debtor must pay all of their disposable income to their creditors, except for a small amount that they can use for their living expenses.
If a debtor has a lot of nonexempt property, they may have to pay a higher monthly payment under their Chapter 13 plan. This is because the trustee will want to ensure that the debtor is able to pay off their nonexempt property over the course of the plan.
In some cases, a debtor may be able to keep their nonexempt property by convincing the bankruptcy court to approve a modification to their repayment plan. This can happen if the debtor’s income decreases or if their expenses increase. The role of nonexempt property in Chapter 13 bankruptcy is to help the debtor repay their debts. By paying the value of their nonexempt property to their creditors, the debtor can avoid liquidation and discharge their debts over time.
Here are some additional things to keep in mind about nonexempt property in Chapter 13 bankruptcy:
- The debtor can claim exemptions for their nonexempt property. This will reduce the amount of money that they must pay to their creditors.
- The debtor must file a budget with the bankruptcy court. This budget will show how much money the debtor has coming in and going out each month.
- The debtor must make monthly payments to their creditors under their repayment plan.
- The debtor must complete their repayment plan in full to discharge their debts.
Call Our Kansas City Bankruptcy Attorney Today!
Overall, bankruptcy involves complex and confusing concepts that you need to understand before filing. If you file without knowing everything first, you are risking your valuable properties. To avoid this from happening, contact an experienced bankruptcy attorney.
Jeppson Law Office is the one that you can trust. Joseph Chaddick Jeppson is one of the very few board-certified specialists in consumer bankruptcy matters. Our legal team is strongly committed to get the best possible results to help you achieve your financial goals. Get an initial consultation now!