Bankruptcy Exemptions in Nevada
The fear of losing property in bankruptcy keeps many people from seeking the bankruptcy advice they need from our Las Vegas bankruptcy lawyers. However, the fact is that most bankruptcy cases filed in Nevada do not result in the loss of any property. Most debtors keep all property in a Chapter 7 or Chapter 13 case, unless they choose to voluntarily surrender the property to get rid of a secured lien payment.
There are cases in which an asset might be at risk in a Chapter 7 case. For that reason, you want to talk to an experienced bankruptcy attorney in Las Vegas before you file for bankruptcy relief. Our lawyers can review your case at no charge to you to determine if any of your property may be at risk of being sold by a Chapter 7 trustee. After that, you can decide if filing bankruptcy is best for you.
What is a Bankruptcy Exemption?
The bankruptcy laws recognize that a debtor needs to keep some assets to have the best chance of recovering and rebuilding his or her finances after a bankruptcy case. With that in mind, Congress included bankruptcy exemptions in the Bankruptcy Code.
These exemptions protect specific amounts of equity in property that is necessary to a debtor’s recovery after a bankruptcy filing. Exempt equity cannot be used to repay debts in a bankruptcy case.
The list of exemptions is extensive. Bankruptcy exemptions protect assets, including household goods and clothing to homes, vehicles, and retirement accounts. You can protect the equity in personal property, health aids, and business equipment. There are very few assets that are not included in the list of exemptions.
The amounts of the bankruptcy exemptions vary. Therefore, you want to make sure that you talk to a Las Vegas bankruptcy attorney to ensure that the equity you have in your assets is covered by the amounts included in the bankruptcy exemptions.
Federal Bankruptcy Exemptions vs. Nevada Bankruptcy Exemptions
The Bankruptcy Code contains a list of federal bankruptcy exemptions available to all debtors in bankruptcy. However, the Bankruptcy Code permits states to set bankruptcy exemptions for use by debtors filing for bankruptcy relief in their state. Some states force debtors to use state bankruptcy exemptions, while other states allow debtors to choose between federal and state bankruptcy exemptions.
Nevada is one of the states that requires debtors to use the state bankruptcy exemptions. If you have lived in Nevada for 730 days or longer, you must use the state bankruptcy exemptions.
However, if you have lived in Nevada for less than two years, the bankruptcy exemptions you use depend on where you resided before Nevada. Our Las Vegas bankruptcy lawyers analyze your residency for the past three years to determine which bankruptcy exemptions you can use to protect property in bankruptcy.
What Are the Nevada Bankruptcy Exemptions?
The Nevada bankruptcy exemptions are listed in the Nevada Revised Statutes §21.090. The amounts of the bankruptcy exemptions are subject to change. Therefore, you need to talk to a Las Vegas bankruptcy attorney when analyzing the bankruptcy exemptions for your case to ensure you have the most recent figures for Nevada bankruptcy exemptions.
In most cases, the Nevada bankruptcy exemptions protect greater amounts of equity in property compared to federal bankruptcy exemptions. For that reason, many of the Chapter 7 cases filed in Nevada are no-asset cases. The debtors do not own any property that has equity above the bankruptcy exemption amounts. For Chapter 13 debtors, the generous bankruptcy exemptions prevent equity in assets from being used to increase the Chapter 13 plan payment.
How Do Nevada Bankruptcy Exemptions Work?
A Chapter 7 trustee reviews your assets to calculate net equity. Net equity is calculated by subtracting the amount of the bankruptcy exemption and any secured lien from the fair market value of the asset. If there is sufficient net equity, the Chapter 7 trustee can sell the property, give you the exemption amount, and use the net proceeds to pay your unsecured creditors.
In a Chapter 13 case, non-exempt equity can affect your Chapter 13 plan payment. Your unsecured creditors must receive at least as much as they would receive in a Chapter 7 liquidation. Therefore, depending on how much your proposed plan payment is before considering non-exempt equity, the non-exempt equity in an asset could increase your Chapter 13 plan payment.
Contact Our Las Vegas Bankruptcy Attorneys For Help
The bankruptcy attorneys at Your Vegas Lawyers, LLC, have significant experience analyzing bankruptcy exemptions. We understand how to effectively calculate net equity to determine any risks to your property in a bankruptcy case. Let us review your case at no charge to give you an experienced opinion about your property in a bankruptcy filing.
Call our office today to schedule your free consultation with an experienced Las Vegas bankruptcy attorney.