Choosing Between Federal and Texas Bankruptcy Exemption Sets

Texas personal property exemptions represent the assets that you do not have to give up when filing bankruptcy in order to settle your debts. Each state establishes its own exemption set, and they vary between states. Texas exemptions are considered to be some of the most liberal or generous.

The bankruptcy attorney in Tyler, TX will be able to fully explain the exemption laws.  There are both state and federal exemptions, and Texas allows bankruptcy filers to choose between the state and the federal exemption set. In some states you can use items from both sets of exemptions.

Because of the complexity of the exemptions, you will want to work closely with your attorney to determine which of your assets fall under the exemptions. The generous Texas law means many people choose to use the state exemption set to maximize their holdings. Your bankruptcy attorney in Tyler, TX can review each of your assets and determine which law section it falls under while preparing a plan for the bankruptcy court trustee to review.

Texas allowable exemptions are very detailed. Following are the major categories of exemptions and a few detailed examples of the types of items included in each category. This is not a complete list by any means so please keep in mind that this is not legal advice. You must consult with an experienced bankruptcy attorney in Tyler, TX to get the full exemption set.

 > Homestead (Property or Acreage) – exempts 1 acre of property in town or city and 100 acres of property outside the town or city

 > Personal Property – exempts athletic and sporting equipment; furniture; family heirlooms; 1 vehicle per licensed driver; 2 donkeys; mules or horses with saddle and bridle; various livestock like cattle and chickens; pets

 > Insurance – life, accident and health insurance benefits and other types of group insurance

 > Pensions – exempts most pension plan benefits including private and public pensions

 > Public Benefits – exempts income that is public assistance, unemployment compensation, workers’ compensation and medical assistance

 > Wages – exempts unpaid wages and commissions (to 75%)

 > Tools – tools used in trade or to do job are exempted including vehicles, electric and hand tools and books

The exemptions are carefully limited by the Texas laws which is why you need to work closely with a bankruptcy attorney in Tyler, TX. For example, a family can exempt property up to $60,000. Jewelry can be exempted up to an amount equal to 25% of the total exemptions. These kinds of limits are in place for most of the Texas exemptions.

In some situations it may be better for the bankruptcy filer to substitute the federal exemption set for the state. But the bankruptcy attorney Tyler, TX residents use will work closely with the bankruptcy trustee to insure you are treated fairly according to the law. As you can see, it is no longer necessary to give up everything you own when filing bankruptcy.

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