People who have to file for bankruptcy often wonder what’s going to happen to their assets when they file. The answer to this depends on exactly what asset they want to know about. When you file for bankruptcy, your assets are either exempt or non-exempt.
Exempt assets can’t be seized by the bankruptcy trustee, but non-exempt assets can. It’s up to the bankruptcy trustee to decide if non-exempt assets are valuable enough to liquidate and pay off the debts. If the trustee decides that they’re not valuable enough to pay off the debts, they likely won’t seize them.
What are the exemptions in Georgia?
In some states, the federal exemptions can be used. However, Georgia requires that all filers use the state exemptions. Georgia has exempt property divided into specific categories. Some of these include:
- Homestead exemption of up to $21,500 in equity for a primary residence. Married couples can double that amount
- Unpaid wages in the amount of 75% of disposable weekly earnings, or 40 times the federal minimum wage, whichever is greater
- Motor vehicle equity up to $5,000
- Tax-exempt retirement plans in an unlimited amount
- Personal property, including household goods and clothing, up to $5,000. A $300 per item limit applies
- Wild card exemption of up to $1,200 that can be applied to anything. Plus, an unused homestead can add up to $10,000 to that
Filing for bankruptcy can be complex, and knowing the exemptions and how they work is only one part of that process. It may be beneficial for anyone who’s facing the possibility of bankruptcy to work with someone who understands the process so they can have guidance as they go through it.