PLANO BANKRUPTCY LAWYERS

Specializing in Chapter 7 & Chapter 13 Bankruptcy Law

Our Plano bankruptcy law firm offers free initial consultations via phone or in person. To obtain your Free Consultation, simply complete the short form to the right of the page, or call:  

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Bankruptcy Exemptions

Texas and Federal Bankruptcy Law

Bankruptcy Exemptions

Debtors filing for bankruptcy must identify those assets which they wish to exclude from the bankruptcy estate. In other words, the debtor must specifically identify each asset he or she wishes to keep. If a debtor fails to list an asset that might otherwise be exempt, the bankruptcy trustee has the right to compel the debtor to turn that asset over to the trustee so that the trustee might sell it and distribute the proceeds to the various unsecured creditors.

Note, however, that all assets are not necessarily exempt. There are substantial limitations on which assets may be exempt, which limitations will either be governed by federal law or Texas law. It is up to the debtor to select which set of exemption statutes will apply to his or her case.

For those assets that may be exempt under federal law, refer to our Federal Bankruptcy Exemptions page. For those assets exempt under Texas law refer to our Texas Bankruptcy Exemptions page. Note that there are certain additional federal exemptions if the debtor selects the Texas exemption laws. Those other federal exemptions are listed here. Lastly, you should be aware that any and all ERISA qualified retirement plans are actually not property of the bankruptcy estate. Technically such plans never become property of the bankruptcy estate and, therefore, need not be exempt. Patterson v. Shumate, 504 U.S. 752, 112 S.Ct. 2242 L.Ed.2d 519 (1992) (concluding that 206(d)(1) of ERISA (29 U.S.C. § 1056(d)(1)) and 26 U.S.C. § 401(a)(13), which was added by ERISA, are determinative for purposes of section 541 of the Bankruptcy Code and such qualifying plans do not constitute property of the bankruptcy estate). Note that Patterson v. Shumate has no bearing upon IRAs. Patterson v. Shumate, 504 U.S. at 763. (section 1051(6) of ERISA specifically exempts IRAs from its anti-alienation provisions).

DEMARCO•MITCHELL, PLLC encourages you to schedule a Free Legal Consultation in order to learn more about bankruptcy exemptions.