Generally speaking the following assets have exemptions that can be applied to them so that some or all of the asset can be protected:
1. Homes
2. Cars
3. Personal property
4. Tools of the trade
5. Retirement accounts
6. Tuition savings plan
7. Life insurance proceeds/cash value of policies
8. Proceeds of a personal injury lawsuit
9. Back due wages
10. Public benefits
The question is always how MUCH of an exemption do I get in order to protect my assets. The answer is: It depends on what state you live in.
Here in IL the following are a general list of exemptions and their amounts. This list was borrowed from a wonderful source known as Illinois Pro Bono. The link can be found here.
| Type of Property | Amount of Exemption | Controlling Statute |
| Residence or homestead of individual. Includes farm, lot and buildings, condominium, mobile home or cooperative. Can be owned or leased. | $15,000 | 735 IL Compiled Statutes (ILCS)5/12-901 (735 ILCS 5/12-906 includes proceeds of sale for 1 year) |
| Necessary wearing apparel, bible, school books and family pictures. Prescribed health aids of debtor and dependents. | 100% | 735 ILCS 5/12-1001(a) 735 ILCS 5/12-1001(e) |
| Any personal property of the debtor | $4,000 | 735 ILCS 5/12-1001(b) |
| One motor vehicle | $2,400 | 735 ILCS 5/12-1001(c) |
| Implements, professional books, tools of trade | $1,500 | 735 ILCS 5/12-1001(d) |
| Proceeds and cash value of life insurance policies and annuity contracts payable to dependent of insured | 100% | 735 ILCS 5/12-1001(f) |
| Public benefits: social security, unemployment compensation, public assistance, veteran's and disability and illness benefits | 100% | 735 ILCS 5/12-1001(g) (1), (2), (3) |
| Alimony, support or separate maintenance | Amount reasonably necessary to support debtor and dependents. | 735 ILCS 5/12-1001(g)(4) |
| Crime victim's reparation awards | 100% | 735 ILCS 5/12-1001(h)(1) |
| Wrongful death payments as a result of the death of a person who supported the debtor | Amount reasonably necessary to support debtor. | 735 ILCS 5/12-1001(h)(2) |
| Life insurance payments from a policy insuring a person who supported the debtor | Amount reasonably necessary to support debtor and dependents. | 735 ILCS 5/12-1001(h)(3) |
| Payments on account of bodily injury to the debtor or a person who supported the debtor | $15,000 | 735 ILCS 5/12-1001(h)(4) |
| Restitution payments made under Federal Civil Liberties Act of 1988 and the Aleutian and Pribilof Island Restitution Act | 100% | 735 ILCS 5/12-1001(h)(5) |
The bottom line is that MOST people who are filing Chapter 7 bankruptcy can protect their homes as long as they don't have much equity, one or two cars depending on the values, and normal household items.
Some things that are considered "assets" that people usually don't think about:
1. Your anticipated Federal Tax Refund
2. Proceeds from a potential lawsuit claim you may have against someone
3. Lottery proceeds
4. Inheritances
I'll end this blog post with the usual lawyer-speak. ALWAYS speak to a knowledgeable attorney about your assets before filing for bankruptcy.
More questions? Ask us.
www.schottlerlaw.com
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