You don’t have to give up all your assets when you file for bankruptcy in Cobb County, or any part of Atlanta, GA. By taking advantage of bankruptcy exemptions, you could keep a significant portion of them safe. How much can you save? It depends on the state you’re residing in. Every state has the right to set its own limits. We’ll go into more detail about bankruptcy exemptions in the state of Georgia in this article.
How do Bankruptcy Exemptions work in Georgia?
The Federal government has a standard list of exemptions. Most states allow you to choose from the Federal list and the state list. You can’t mix and match between the two. You’ll see a lot of variety in the exemptions you get across states. In general, exemptions are offered based on the following categories: property, personal items, vehicles, and wages. There’s also a ‘wildcard’ category where you can protect something that has great personal value.
In Georgia, you’re covered by the Ga. Code Ann. §44-13-100. You’re allowed to choose between that and the Federal list. Which one is better? That depends on your unique situation. You’ll need to learn more about the two before you can make an informed decision — or you could talk to an experienced lawyer for help.
Exemptions are always applied to your equity or personal stake in an asset, and not the value of the asset as a whole. For example, if you paid for 40% of a house and your spouse paid 60%, your equity is 40%. The exemption will be based upon the 40% that you own.
The Georgia Bankruptcy Exemptions List
- Homestead
- The ‘Homestead‘ refers to the place where you stay. The Ga. Code Ann. §44-13-100(a) (1) lets you exempt $21,500 from the value of that property if you’re a co-owner. You can exempt $43,000 if you’re the sole owner. Burial plots are also covered by the exemption that you — the debtor –, or a dependent, own. If you don’t breach the exemption limit, the remaining amount (up to $10,000) can be applied to properties other than your residence under the Ga. Code Ann. §44-13-100(a) (6).
- We’ll explain with an example. If you’re the sole owner of a house that costs $70,000, your equity is 100%. The house will have to be sold, though you’ll be able to exempt $43,000. The creditor or trustee will take $27,000. If you only own a portion of the house, your house might not be sold, depending on your equity. If the equity or personal stake in the property exceeds the $21,500 mark, your house gets sold.
- Personal Property
- Personal property refers to everyday items like clothes, jewelry, food, and household goods. The state ensures you have enough to survive, move forward and eventually recover from the bankruptcy.
- Ga. Code Ann. §44-13-100(a) (5) grants a $500 jewelry exemption.
- Ga. Code Ann. §44-33-100(a) (4) grants a $5,000 exemption for crops, animals, clothes, furniture, books, instruments. You have a $300 limit for every item, and the combined total can’t exceed $5000.
- Ga. Code Ann. §44-13-100(a)(11)(E) will exempt some a portion of income from sources– a reasonable figure you and your debtors need to live on.
- Ga. Code Ann. §44-13-100(a)(10) offers a full exemption for healthcare items.
- Ga. Code Ann. §44-13-100(a)(11)(D) exempts $10,000 personal injury costs.
- Ga. Code Ann. §44-13-100(a)(11)(B) exempts costs arising from wrongful death.
- Personal property refers to everyday items like clothes, jewelry, food, and household goods. The state ensures you have enough to survive, move forward and eventually recover from the bankruptcy.
- Vehicle
- The vehicle exemption will let you save your car if you’re still paying for it in rare cases. You will probably have to sell it off if you own it outright.
- Ga. Code Ann. §44-13-100(a)(3) allows a motor vehicle exemption of $5,000.
- How does that work? If you own the car and it can be sold for $10,000, you get to keep $5000. If you’re still paying off the car loan and your personal equity is less than $5000, you can keep it.
- The vehicle exemption will let you save your car if you’re still paying for it in rare cases. You will probably have to sell it off if you own it outright.
- Wages
- You’ll get to save a significant portion of your income from a job in this category. You can ask for more if you fall under a certain range.
- Ga. Code Ann. §18-4-20 and §18-4-21 offers a 75% exemption of earned-but-unpaid weekly disposable earnings.
- There’s also a clause that allows you to keep 40 times the state or federal hourly minimum wage if that’s higher.
- A bankruptcy judge will exempt more if you don’t meet a certain income threshold.
- You’ll get to save a significant portion of your income from a job in this category. You can ask for more if you fall under a certain range.
- Benefits and Pension/Retirement
- The state offers a full exemption on any benefits you get or any pension/retirement schemes that have been set up for you under the Ga. Code Ann. §44-13-100(a)(2) and (2.1). Here is an overview of what’s exempt:
- Social Security
- Unemployment fund
- Support for veterans
- Disability and illness
- Alimony payments, up to certain amount needed for you and your dependents to live on
- Pensions, annuities, and similar plans — up to an amount necessary for you and dependents to survive
- IRA — up to the amount needed for you and your dependents need to live on
- Certain property or funds that are being held for you under a retirement or pension plan (for employees or public officers)
- The state offers a full exemption on any benefits you get or any pension/retirement schemes that have been set up for you under the Ga. Code Ann. §44-13-100(a)(2) and (2.1). Here is an overview of what’s exempt:
- Wildcard
- Have something you treasure that you need to protect? That comes under the ‘Wildcard’ category. The amount is in addition to the $10,000 homestead exemption for ‘other’ properties.
- Ga. Code Ann. §44-13-100(a)(6) lets you exempt $1,200 on whatever you want.
- Have something you treasure that you need to protect? That comes under the ‘Wildcard’ category. The amount is in addition to the $10,000 homestead exemption for ‘other’ properties.
Before You File for Bankruptcy in Georgia
Filing for bankruptcy is a life-altering decision. Consulting with a professional Cobb County Bankruptcy Lawyer will help you understand your options and do right by your family. We at Blevins and Hong are here to help. Give us a call today at (678) 354-2290.
