703’s vs. 704’s-Modesto, CA Attorney

California has two different sets of exemptions you can use to protect your property when you file for bankruptcy. They are commonly referred to as 703’s or 704’s. If you have equity in your primary residence, then you will be using the 704’s as they protect up to $150,000 in equity. Most people however, don’t any equity these days, so they use their 703 exemptions. The 703’s come with the “wild card” exemption which protects about $21,000 in whatever property you want, and that’s aside from you retirement, household furnishings, and clothing.

Spouses using the same exemptions- Lawyers Modesto, CA

When married couples file for bankruptcy they must both use the same set of exemptions. This includes the situation where a divorce is pending, but not final. If one spouse decides to file for bankruptcy then the other spouse must sign a waiver indicating he or she would use the same set of exemptions if he or she files bankruptcy.

Wild card protection- Attornet Modesto, California

If you have a qualified retirement plan, such as a 401k or IRA, then don’t worry about it because it’s almost always going to be protected. Your house furnishings and clothing are protected too unless you have some super expensive stuff. The wild card can basically protect anything you want when you file for bankruptcy like stocks, bonds, paid off cars, coin collections, tax refunds, inheritance, etc. Add it all up and if it’s under $21,000 (sometimes $24,000 if you use a car) then your property is protected.

Same Sex couples-Modesto Attorney

The federal bankruptcy laws discriminate against same sex couples as they cannot file their petition together. However, this could work as an advantage as each person can use their own separate exemption and protect their property. For example, one partner could use the 704’s to protect $75,000 in home equity while the other partner could use the 703's to protect a stock account worth $21,000.