Bankruptcy Exemptions in Texas
Protecting Your Property During Bankruptcy
Many believe they will lose everything if they file for Chapter 7 or Chapter 13 bankruptcy. However, you should know that this is nothing more than a common misconception. In Texas, debtors can use either state or federal bankruptcy exemptions to protect their property—up to a certain dollar amount.
While all states have their own exemption laws, if you file for bankruptcy in Texas, you have the option to use either state or federal property exemptions. You cannot use both, which is why it would be wise to discuss your options with a Dallas bankruptcy attorneyat Allmand Law Firm, PLLC before moving forward with your bankruptcy case.
To learn more about your options, call us for a free bankruptcy consultation!
Will I Be Able to Keep My Home?
If you elect to use state bankruptcy exemptions, you may be able to protect the entire value of your home. Texas offers an unlimited homestead exemption, as long as your property does not exceed 10 acres in a city, town, or village or 100 acres elsewhere. If your rural homestead is occupied by a family, this limit is doubled to 200 acres.
Other Property Exemptions Under Texas Law
Texas exemption laws allow you to exempt the entire value of one motor vehicle per licensed household member, as well as up to $100,000 in personal property per family or up to $50,000 if you are a single adult. Personal property may include:
- Up to two firearms
- Home furnishings
- Jewelry (up to $25,000)
- Clothing and food
- Health savings accounts
- Sporting equipment
It is also important to note that both Texas and federal bankruptcy exemptions can be doubled if you and your spouse file jointly. You would each be entitled to your own exemptions, making it possible for you to protect double the amount of property.
Should I Use State or Federal Exemptions?
If you have significant equity in your home or a large amount of personal property, state exemptions may be the right choice for you. Texas law offers generous exemptions for your home, motor vehicles and personal property; however, one advantage of choosing federal exemptions is that you can benefit from a “wildcard exemption.”
A wildcard exemption can be applied to any property that you own. With this, you could exempt up to $1,225 plus any amount left over from the homestead exemption, up to $11,500. If you do not claim your full homestead exemption under federal law, you would have up to $12,725 that could be applied to any of your property.
Find out which type of bankruptcy exemptions would most benefit you by speaking to our bankruptcy lawyers in Dallas. Call our office today to get started!