New York Bankruptcy Exemption Laws

Bankruptcy

New York Bankruptcy Exemption Laws

NY Bankruptcy InformationNew York Bankruptcy Exemption Laws

(Portions reprinted by permission from How to File for Chapter 7 Bankruptcy, Nolo © 1989-2018 )


Dislcaimer

Disclaimer

Citations and links to primary law and secondary sources are provided for those who wish to do further research. Every effort has been made to make this information up to date and accurate, but laws can and do change without notice. Persons relying on this information are responsible for confirming its timeliness and accuracy before relying on it. (This information was updated in December 2014.)

Also bear in mind that these brief summaries do not list every detail or exception to these exemptions. For example, there are often exceptions for collection of child support debt and/or taxes. These listings are designed to inform you of laws that exist for your benefit, so that you may exercise what rights you may have.

Finally, this website is intended to provide information only. It cannot answer whether your property does or does not qualify for a specific exemption.

ADVERTISEMENT - LegalConsumer.com does not endorse or review advertised services.

Talk to a Local Bankruptcy Attorney

Enter Your Zip Code or Call (855) 410-1378 to Connect with a Lawyer In Your Area

ADVERTISEMENTS - LegalConsumer.com does not endorse or review advertised products or services.

ADVERTISEMENTS - LegalConsumer.com does not endorse or review advertised products or services.

ADVERTISEMENT - LegalConsumer.com does not endorse or review advertised services.

Talk to a Local Bankruptcy Attorney

Enter Your Zip Code or Call (855) 410-1378 to Connect with a Lawyer In Your Area

^ Top
Homestead | Insurance | Retirement | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |

Exemptions

Federal vs. State Exemption Statutes and How to Read Them

Some states offer you a choice of their State law exemptions or the Federal bankruptcy exemptions.

Other states require you to use their state exemptions.

Some states have special exemptions that apply specifically to bankruptcy, while others apply exemption laws that affect any kind of court-ordered collection activity.

As such, the wording of these statutes commonly speak in terms used in court-ordered procedures such wages not being subject to or "garnishment" or of property or pension funds not being subject to "attachment" ...they're not talking sentimental attachment... they mean liens -- that are "attached" to property -- and sometimes can be "stripped" away or "avoided" (i.e. eliminated) in bankruptcy.

Also, unlike what you see on this web page, most states don't list their exemptions in a neat little table.

What appears on this page is a rather simplified summary of exemption laws to let you know what laws are out there and where to find them.

Users should check the actual citations for specific limitations or qualifications or updates of these exemptions.

One more thing... Some states change the exemption amounts by adminstrative order, so the numbers in the statute are old, and don't match current amounts, which you'll see here.

In states where that is the case, I make a note of that.

A few courts offer a simplified list of current exemptions and their amounts, but most don't. Wouldn't hurt to ask the clerk.

 

Federal Bankruptcy Code Exemptions Not Available in

Although the federal bankruptcy code provides a list of exemptions, these exemptions are not available in . law requires you to use the exemptions found in state law -- not the U.S. bankruptcy code.

Federal "non-bankruptcy" exemptions are available

However you are entitled to use so-called federal "non-bankruptcy" exemptions in addition to your state law exemptions. Non-bankruptcy exemptions are those found provisions of U.S. law that are not part of the bankruptcy code.

The four most significant non-bankruptcy exemptions are for

  • Wages (a general cap on what percentage of your wages can be garnished),
  • Social Security benefits,
  • Civil Service benefits,
  • Veterans Benefits

Other so called "non-bankruptcy" exemptions mostly deal with various benefits to government and military personnel, with a few odd laws regarding specially-regulated labor markets such as railroad workers, seamen, and longshoremen.

Can you double exemptions for joint filers? (General principles)

If you are married and filing together, you and your spouse must use the same law; one cannot use federal law while the other uses state law. However, the exemption law chosen applies separately to each spouse. Thus, it is generally possible to double the amount of state law exemptions, Cheeseman v. Nachman, 656 F.2d 60 (4th Cir. 1981) (married couple filing a joint petition was entitled to double the Virginia homestead exemption), unless state law (e.g. California) specifically prohibits a couple from doubling certain exemptions. See First National Bank v. Norris, 701 F.2d 902 (11th Cir. 1984)(Alabama); Granger v. Watson, 754 F.2d 1490 (9th Cir. 1985)(California).

^ Top
Homestead | Insurance | Pensions | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |

ADVERTISEMENT - LegalConsumer.com does not endorse or review advertised services.

Talk to a Local Bankruptcy Attorney

Enter Your Zip Code or Call (855) 410-1378 to Connect with a Lawyer In Your Area


Homestead Exemption

Home Valuation tools

Zillow.com Recommended! Wonderful tool that shows home values in your neighborhood. This link will take you to a listing of the average home value in your zip code. Just add your street address to get an estimate of the value of your house, and all others in your neighborhood. (Note: Does not serve all areas, and valuations are imperfect estimates only.)

Yahoo Real Estate offers comparable home sales in your neighborhood.

Almost every state provides protection for equity in the family home, and many states have increased the amount of protection in recent years. Seven states offer unlimited protection. Most states are not as generous.

New Federal Residency Requirement

Under the new bankruptcy law, you must be have lived in the state for at least 40 months (three years and four months) before you can claim any homestead protection greater than $160,375. (If your state's exemption offers less than this amount, the law is irrelevant to you.) The law is poorly worded but seems to say that if you move from one home to another in the same state, you can claim that state's homestead protection.

IF you are moving to another state, OR you moved to within in the last two years, click here.

  • NY Exemptions
  • Real property including co-op, condo, or mobile home, to $170,825 for the counties of Kings, New York, Queens, Bronx, Richmond, Nassau, Suffolk, Rockland, Westchester, and Putnam; $142.350 for the counties of Dutchess, Albany, Columbia, Orange, Saratoga, and Ulster; $85,400 for the remaining counties in the state. (husband & wife may double)
    In re Pearl, 723 F.2d 193 (2nd Cir. 1983)
    N.Y. CPLR § 5206 (a)

^ Top
Homestead | Insurance | Pensions | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |


Tenancy by Entirety Exemption

Tenancy by the Entirety (TBE) is a form of property ownership, based on traditional English common law, that is still recognized in about 1/2 of states and the most common form of martial property ownership in many of them.

It protects property that is jointly owned by a married couple as an "entirety" -- which is to say, as a single marital entity, not as individuals.

Tenancy by the Entirety (TBE) was originally conceived as a debt shield -- a way of protecting wives and children from being left homeless and penniless as a result of the debts of a husband. Under the English common law TBE doctrine, a husband could not sell property owned by "the entirety", or give it away, or pledge it as security for a loan without the consent of his wife.

Today, 25 states still recognize some form of tenancy by the entirety, but they differ on the extent to which the property is exempt.

^ Top
Homestead | Insurance | Pensions | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |


Insurance exemptions

Virtually all states protect life insurance proceeds in some manner or another. Some restrict it to proceeds paid to a dependent. Many states also protect the cash-value or loan-value of insurance policies.

If a substantial amount of your assets are in life insurance, you may want to consult a professional to determine the extent to which those policies are exempt. The website AssetProtectionBook.com does particularly thorough job of covering insurance exemptions.

^ Top
Homestead | Insurance | Pensions | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |


Miscellaneous other exemptions for

This category covers items like partnership property, alimony & support payments.

^ Top
Homestead | Insurance | Pensions | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |


Pensions & Retirement Savings Exemptions

The new federal bankruptcy law now automatically exempts a virtually all tax-exempt pensions and retirement savings accounts from bankruptcy, even if you are using state law exemptions. 11 U.S.C. § 522(b)(3)(C). (See Help Topic: Special Rules For Retirement Accounts.)

The law protects up to $1,283,025 of any pension or retirement fund that qualifies for special tax treatment under Internal Revenue Code sections 401, 402, 403, 408, 408A, 414, 457, or 501(a).

  • ERISA-qualified benefits, IRAs, & Keoghs & income needed for support
    N.Y. CPLR § 5205 (c)
    N.Y. Debt. & Cred. Law § 282 (2)(e)
  • Public retirement benefits
    N.Y. Ins. Law § 4607
  • State employees
    N.Y. Retire. & Soc. Sec. Law § 10
  • Teachers
    N.Y. Educ. Law § 524
  • Village police officers Unconsolidated
    N.Y. Unconsol. Law § 5711-o
  • Volunteer ambulance workers' benefits
    N.Y. Vol. Ambul. Workers’ Ben. Law § 23
  • Volunteer firefighters' benefits
    N.Y. Vol. Fire. Ben. Law § 23
    N.Y. Gen. Mun. Law § 206-b

^ Top
Homestead | Insurance | Pensions | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |

ADVERTISEMENT - LegalConsumer.com does not endorse or review advertised services.

Talk to a Local Bankruptcy Attorney

Enter Your Zip Code or Call (855) 410-1378 to Connect with a Lawyer In Your Area


Personal Property Exemptions

Auto Valuation Tools:

Kelley Blue Book

Edmunds

Both of these websites offer interactive tools to determine the current value of your used car.

This category covers your car, your non-retirement bank accounts, and most of your other personal possessions, other than your house.

States vary widely on how generous they are in this area. Some exemptions may be for any combination of property up to an aggregate amount. Other exemptions apply only to specific items, such as jewelry.

Remember that an exemption will not protect your car from being repossessed by the holder of the car loan you used to purchase the vehicle if you pledged the vehicle as security for the loan. To keep the car, you will have to pursue other options such as 'redemption' or 'reaffirmation.' See the help topics and How to File for Chapter 7 Bankruptcy for more on this.

^ Top
Homestead | Insurance | Pensions | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |


Public Benefits Exemptions

Most states exempt public benefits, consistent with the notion that such benefits are intended as a safety net for the recipient.

^ Top
Homestead | Insurance | Pensions | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |


Tools of Trade Exemptions

These are the things you use to make a living. An automobile or truck can be a tool of trade if you use it as such. Commuting to work doesn't count, but if driving is a necessary component of transacting your business, you can claim your vehicle is a tool of trade.

  • Farm machinery, team & food for 60 days; professional furniture, books, & instruments to $3,400 total
    N.Y. CPLR § 5205 (a),(b)
  • Uniforms, medal, emblem, equipment, horse, arms, & sword of member of military
    N.Y. CPLR § 5205 (e)

^ Top
Homestead | Insurance | Pensions | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |

ADVERTISEMENT - LegalConsumer.com does not endorse or review advertised services.

Talk to a Local Bankruptcy Attorney

Enter Your Zip Code or Call (855) 410-1378 to Connect with a Lawyer In Your Area


Wage Garnishment Laws

Most states have a wage garnishment law. In some states, wage garnishment laws can be used in bankruptcy as an exemption to protect income that you had coming due, but not yet received, as of the day you filed, for work you had already done -- so called "earned but unpaid wages".

In some states, the wage garnishment law protects not only wages owed to you, but also wages already in your possession and saved over time preferably holding it in a separate bank account. In other states wage garnishment laws do not protect wages once they are they are in your possession.

There is a federal wage garnishment protection found in the CCPA (Consumer Credit Protection Act), 15 U.S.C. § 1673, which limits how much of your pay can be taken for collection purposes. But this law law is generally found not to be an exemptions in bankrupty. See, e.g. IN RE HORTON, Case No. 10-53495., Bankr. ED Kentucky, 3/4/2011

Some courts have also held that some state wage garnishment laws do not create an exemption in bankruptcy. See, eg. Utah, Tennessee, Vermont, Missouri.

Other courts have held that state garnishment statutes DO create an exemption. See, e.g., Oregon, Iowa, Ohio, Kansas, Indiana.

And in Illinois there are recent published bankruptcy court opinions going both ways on the issue of whether Illinios wage garnishment law can be used as an exemption in bankruptcy.

Click here for collected case law on the question: Do wage garnishment laws create an exemption in bankruptcy?

Finally, if you live in a state that lets you use the Federal bankruptcy exemptions in 522(d), and you choose to use them, then you get no exemption for earned but unpaid wages; the wildcard exemption is your only option. See, e.g. U.S. v. Christensen, 200 B.R. 869 (D.S.D. 1996) (applying FDCPA law, based on similar statutory structure to bankruptcy's opt-out law)

^ Top
Homestead | Insurance | Pensions | Personal Property | Public Benefits | Tools of Trade | Wage Garnishment | Wild Card |


Wild Card Exemption

Most, but not all, states allow a so-called "wild-card" exemption that can apply to any property. The wild card exemption can be of particular help if one or more of your other exemptions falls short of protecting your equity. You may split your wild card exemption amount over multiple items and stack it atop other exemptions as needed to protect exposed equity.


ADVERTISEMENT - LegalConsumer.com does not endorse or review advertised services.

Talk to a Local Bankruptcy Attorney

Enter Your Zip Code or Call (855) 410-1378 to Connect with a Lawyer In Your Area