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|| BANKRUPTCY LAW NEWS ||
NEW YORK BANKRUPTCY EXEMPTIONS
INCREASES & CHANGES EFFECTIVE
JANUARY 21, 2011.  

On December 23, 2010, a long overdo bankruptcy legislation was signed
into law by New York State Governor David A. Paterson. The bill,  S.7034-
A/A.8735-A, will increase the monetary amount of  exemptions permitted
in bankruptcy proceedings and allow debtors to choose between federal  
or the new New York state exemptions. The significant changes,
effective January 21, 2011, are follows:

New York Bankruptcy  Exemption Increases:

  • The Homestead Exemption (CPLR Section 5206) has been
    increased from $50,000.00 to $150,000.00 for the counties of
    Nassau, Suffolk, Kings, Queens, Bronx, Richmond, Rockland,
    and Putnam. Other counties have also increased to either
    $75,000.00 or $125,000. if a husband and wife own and reside at
    a home together, they can exempt up to $300,000.00 worth of
    equity;
  • The Motor Vehicle Exemption (Section 282 of Debtor & Creditor
    Law) was increased from $2,400 to $4,000. If the vehicle is
    equipped for use by a disabled person, the exemption amount is
    $10,000;
  • The Tools of Trade Exemption exempting necessary working
    tools and implements applicable to a trade or to a profession is
    increased from $600 to $3000;
  • The Book and Religious Texts Exemption was increased from
    $50 to $500;
  • The aggregate Personal Property Exemption which exempts
    certain annuities and personal property under Section 283 of the
    Debtor and Creditor Law from $5,000 to $10,000;
  • The Cash Exemption was increased from $2,500 to $5,000 per
    person so long as it does not exceed the aggregate of the
    $10,000 personal property exemption. It can be utilized to the
    extent you do not claim all of the $10,000.00 in the personal
    property exemption.  In addition, if you do not claim a homestead
    exemption, you can assert an additional $1,000.00 exemption in
    personal property, bank account or cash. Therefore, you may be
    able to exempt up to $6,000.00 per person in a bank account,
    cash or possible tax returns.
  • A  Wildcard Exemption was added in the amount of $1,000 which
    may be applied toward personal property, bank accounts or cash
    if no homestead exemption is claimed;
  • The Domestic Animal Exemption and food for the animal was
    increased from $450 to $1,000;
  • Increases the exemption for one watch from $35 to $1,000 and
    adds jewelry and art to this category;
  • Provides an exemption for one computer and associated
    equipment and one cell phone;

Federal Exemptions

The new legislation adds section 285 to the Debtor and Creditor Law that
would permit a debtor to choose either the new New York exemption or
use the federal exemptions. The decision of which one to choose would
usually depend on the type of assets a debtor is trying to exempt. One of
the benefits of the federal exemptions is a "wild-card" exemption which
can be larger than that permitted under New York law.  While, New York
law may have a $1,000 wild-card exemption, if no homestead exemption
is used, the federal laws may permit up to $11,975 to be applied toward
personal property is not otherwise exempted. However, the federal laws
have a smaller homestead exemption ($20,200 without applying the wild-
card exemption) and thus a debtor trying to exempt equity in real property
will usually still use the New York exemptions.


The increases in the exemptions will allow more struggling debtors to
file for Chapter 7 Bankruptcy relief. In addition, many New Yorkers
seeking Chapter 13 bankruptcy protection will have  lower monthly
payments under their Chapter 13 Plan.

FOR MORE INFORMATION ON HOW THE NEW BANKRUPTCY
CHANGES CAN HELP YOU OBTAIN A FRESH START UNDER THE
BANKRUPTCY CODE PLEASE FEEL FREE TO CONTACT
BANKRUPTCY ATTORNEY
MARTIN WOLF AT 212-608-1660.

OUR FIRM, GINSBERG & WOLF, P.C. MAINTAINS OFFICES  IN BOTH
MANHATTAN AND BROOKLYN. FOR MORE INFORMATION ABOUT OUR
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FOR MORE INFORMATION ABOUT OUR LAW FIRM, GINSBERG &
WOLF, P.C.,
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Disclaimer Notice: The information contained herein is considered advertising and informational in nature and should not be used in the
place of retaining counsel. Read Full Disclaimer Notice. Past results do not guarantee similar outcomes in future cases.

Copyright © 2011 Ginsberg & Wolf, P.C. All Rights Reserved.

Our experienced bankruptcy attorneys at the law firm of Ginsberg & Wolf, P.C. practice in the United States Bankruptcy Courts for the Eastern District of
New York and Southern Districts of New York, serving clients in all New York City boroughs, including Brooklyn, Bronx, Manhattan, Queens and Staten
Island and throughout Long Island, including both Nassau and Suffolk counties. We also  practice  in the United States Bankruptcy Courts for the Districts of
New Jersey District and serve clients throughout the State of New Jersey. We provide bankruptcy assistance under Chapter, 7, Chapter 11 and  Chapter 13
of the Bankruptcy Code.

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