The thought of filing for bankruptcy can be frightening to many people. The stress of limited finances and creditor harassment can cause some to make poor choices, but these choices may only worsen an already serious situation. The way to avoid making further mistakes is to contact a bankruptcy law attorney who knows the right steps to take at every juncture of the process.
Michigan Bankruptcy Lawyers With Extensive Tax Knowledge
If you owe federal or state taxes and are considering filing bankruptcy, it is critical to consult an experienced tax attorney who also has extensive knowledge of bankruptcy law. The Law Offices of Jeffrey S. Freeman can help you evaluate all options for resolving your financial problems, including seeking debt relief through Chapter 7 or Chapter 13 bankruptcy.
Thank you for contacting Law Offices of Jeffrey S. Freeman. Your message has been sent.
Call us now
or use the form below.
Based in Birmingham, Michigan, our team of attorneys and qualified investigative and accounting professionals will thoroughly analyze your financial situation and options as you consider bankruptcy. We frequently represent clients throughout the Detroit metro area and Southeast Michigan, including Livonia, Dearborn, Southfield, Novi, Farmington Hills, Troy, Royal Oak, Pontiac, Warren, Sterling Heights, Utica, Mt. Clemens, Fraser, Eastpointe and Ann Arbor.
Many different circumstances can lead to overwhelming debt — and falling behind on personal or business tax debt can make the situation even more intimidating. Our law firm offers the extensive bankruptcy and taxation law knowledge to evaluate your overall financial situation and help you make the best possible decisions for your future.
Exempt vs. Non-exempt Property Under Chapter 7
In a Chapter 7 liquidation case, the debtor must relinquish certain property to the bankruptcy trustee so that he or she can sell the property and use the proceeds to pay off debts. Property of the bankruptcy estate is broadly defined under Section 541 of the Bankruptcy Code. The estate is technically the legal owner of all of the debtor's property and consists of all legal and equitable interests that the debtor has in property at the initiation of the bankruptcy case. Income that the debtor earns after the date of the petition is not included in the estate. Debtors, whether they are businesses or individuals, are often justifiably concerned about what property they will be allowed to keep and what they must give up. A bankruptcy lawyer at Law Offices of Jeffrey S. Freeman in Birmingham, MI, can answer these and other questions, allay fears and keep the process moving forward as painlessly as possible.
A debtor must file a schedule of exempt property with the court. Exempt property is property that the debtor can protect from liquidation. The Bankruptcy Code allows each state to adopt its own exemption laws, which the debtor can select instead of the federal exemptions. It is important to consult with an attorney who can explain the exemptions available under your state's laws and how they compare to the available federal exemptions.
Non-exempt Property
Items that the debtor usually must forfeit include:
- Expensive musical instruments, unless the debtor is a professional musician
- Collections of stamps, coins and other valuable items
- Family heirlooms
- Cash, bank accounts, stocks, bonds and other investments
- A second car or truck
- A second home or vacation home
Exempt Property
Certain types of property are exempt, meaning that the debtor can keep that property. Exempt property includes:
- Motor vehicles, up to a certain value
- Reasonably necessary clothing
- Reasonably necessary household goods and furnishings
- Household appliances
- Jewelry, up to a certain value
- Pensions
- A portion of the equity in the debtor's home
- Tools of the debtor's trade or profession, up to a certain value
- A portion of unpaid but earned wages
- Public benefits, including public assistance (welfare), social security and unemployment compensation, accumulated in a bank account
- Damages awarded for personal injury
Speak to a Bankruptcy Lawyer
If you have questions about what property you will be allowed to retain if you file for bankruptcy under Chapter 7 of the Bankruptcy Code, it is prudent to seek the counsel of an experienced and knowledgeable bankruptcy attorney at Law Offices of Jeffrey S. Freeman in Birmingham, MI, who can respond promptly and accurately and put your mind at ease.
Copyright © 2011 FindLaw, a Thomson Reuters business
DISCLAIMER: This site and any information contained herein are intended for informational purposes only and should not be construed as legal advice. Seek competent legal counsel for advice on any legal matter.
