California and bankruptcy impacts of the Golden State. For example, the exemption laws in California are unique to it, and dictate what the state allows its CA bankruptcy filers to protect.
When does community property end in California? Is it at divorce or separation, and when exactly are two spouses (or future exes) separated?
It’s usually clear when a marriage and community property begin in California. That’s when people say, “I do.” But it can be much harder to tell when it ends.
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California wildcard exemption is big for bankruptcy lawyers protecting their clients’ assets. Here’s the ultimate guide on the new updated California wild card exemption amount, and how to figure it.
In bankruptcy, each state has their own exemptions, or ways they allow debtors to protect some or all of their property. California has opted out of the federal exemptions, and has it’s own passed by our legislature. This is where the California wild card exemption fits in.
Continue reading “New California Wildcard Exemption: the Ultimate Guide (2023)”
The 2024 California homestead exemption numbers are already available, and different from last year, and even the original range of $300,000 to $600,000. In fact, in 2024, they top out way higher than $600,000, which helps you save more of your home from creditors than the homestead exemption could in 2023. Why? Because of inflation. The new California homestead exemption is tied to the CPI, or consumer price index. And everyone knows things lately aren’t cheap.
November 2023 update: The new inflation-adjusted 2024 California homestead exemption is now known. See below what it will be for cases filed after Jan 1, 2024. Don’t worry – the 2023 homestead exemption amount is still here for cases filed before on Dec 31, 2023 or earlier.
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The Los Angeles County median home price in 2023 can be tricky to determine. There are different sources that say different things. It’s not clear which of the many options will be relied upon by courts and trustees for the California homestead exemption. Also, while bankruptcy may seem to be “just forms,” make sure you check out my list of 12 crucial tips to do or avoid before filing bankruptcy.
2023 update: there seems to be a consensus among local bankruptcy attorneys as to what the Los Angeles County median home price is. More than that, this L.A. median price changes each year. While it’s still untested in court, a lot of the initial uncertainty has cleared up. Read on!
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If married, can you double or stack a homestead exemption? A homestead exemption helps protect your residence when you file bankruptcy. But if a married couple files jointly, does each get an exemption? Does the homestead exemption double for each spouse? Maybe. That would allow the debtors to double or stack the homestead exemption and protect more equity.
Courts have struggled with this. On the one hand, the law means what the law says. If the statute says the limit is a number, that’s the number. On the other hand, why should a person not get same the amount as if they were single? Put differently, if the exemption amount is the same if someone single or married, a married person is only getting half the protection.
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The government just updated the numbers for 2024 median income limits. Using median household income, it again got easier to qualify for bankruptcy Chapter 7, because of another means test adjustment. And while bankruptcy may seem to be “just forms,” make sure you check out my list of 12 crucial tips to do or avoid before filing bankruptcy.
The means test for bankruptcy decides who qualifies for Chapter 7 bankruptcy eligibility. The first step of this process is comparing your median household income against the California median income limits set by the Department Of Justice guidelines to see if you earn less than bankruptcy median income limits.
Again, this comparison against the median income is merely the first step, and does not absolutely determine your eligibility for Chapter 7 or not.
November 2023 Update: The numbers for the means test adjusted November 1, and will be used for the first part of 2024.
Because of the above statement, these will be the last updated 2023 median income limits.
Continue reading “2024 Median Income Limits to Nail Bankruptcy Means Test in Calif”
Taxes in bankruptcy don’t normally go away or get discharged. However, there are some exceptions to the rule. Sometimes, older tax debts can be discharged in bankruptcy. One of the keys is the due date of the taxes, which is not always April 15. Events can move the tax due date. These extensions impact the 3-year rule.
One of the factors to determine bankruptcy dischargeability of tax debt is what we call the “three-year rule” per 11 USC 507. Note: there are factors that can stop (or toll) the three-year clock, so three years is not set in stone. See a bankruptcy professional or tax expert for analysis of your unique situation.
Let’s start with the general rule. Section 507 of the Bankruptcy Code says, in part, at (8)(A)(i):
Continue reading “How Bankruptcy Can Ditch IRS Tax: 3-Year Rule & Key Dates to Know”
When a bankruptcy is dismissed or discharged, is the statute of limitations tolled on an earlier claim by the automatic stay, and suspended? Or is the statute of limitations extended by a few weeks with just a little bit of time tacked on? The answer could make a big difference on how much time the creditor has the act on their claim, lawsuit, lien, or other collection actions.
Continue reading “Does Bankruptcy Toll the Statute of Limitations? 108c Top Points”
Someone recently asked, “Are wrongful death recovery proceeds community property in California?” The field of bankruptcy crosses over with so many other areas of law. The question stands at the intersection of bankruptcy law, California community property law, and tort law. But the answer to this wrongful death question is critical for bankruptcy lawyers and someone filing bankruptcy in California.
This might seem like a tiny point, but it’s really important whether a wrongful death claim or funds are community property or not. There are lots of twists and turns as to whether it affects the other spouse when only one spouse files bankruptcy.
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Can one spouse file bankruptcy without the other? In consultations, that’s one question I get asked a lot. When we’re married in California, everything is presumed to be joined and shared. So, can a married person claim a bankruptcy? The answer is, “Yes.”
Even though someone is married, they have every right to file bankruptcy without the other spouse. They have their own Social Security number and their own credit history. But just because you can do something doesn’t mean you should.
Continue reading “One Spouse Filing Bankruptcy: Everything You Need to Know”