Bankruptcy Representation

We live in an amazing state known for gorgeous weather, beautiful beaches, incredible state parks, and lots of fun activities for residents and tourists to enjoy year-round.  We’ve also been blessed with a healthy and growing economy over the past several years.  But, even in the best of times, some residents struggle financially and need help.  Coats Schmidt, P.A. represents individuals as well as businesses, in and out of the courtroom, advising them throughout the entire bankruptcy process.

Process

During the initial consultation with a client we’ll determine if they qualify for bankruptcy and, if so, which chapter of bankruptcy would be best for their specific situation.  For example, there is a “means test” for filing chapter 7,  which applies to the median household income in Florida, while there are debt limitations for filing chapter 13, which will exclude those with too much debt from filing, and then, chapter 11 is often used by businesses, but can be utilized by individuals who don’t want to liquidate their assets in Chapter 7, but have too much debt to qualify for Chapter 13.

Although the Bankruptcy Code is federal law, a bankruptcy case filed in Florida may have a different outcome than the same case filed elsewhere because Florida has its own exceptions and income guidelines.  That being said, a client who recently moved to the state may actually need to file for bankruptcy in the state from which they relocated.

Once we have all the necessary information, we begin the bankruptcy process by assisting the client in reducing debt and selling assets.  Not all debts will be wiped clean.  Credit card balances, medical bills, and personal loans, for example, could be discharged, yet debts owed to the government, like taxes, and debts incurred through a marital separation, like child support, will remain.

Assets

Not all assets will be taken away when filing for bankruptcy.  For example, the Florida Homestead Exemption allows a primary residence, of unlimited value, to be protected from creditors as long as the debtor has lived in the state for 40 months or more, and the property is not larger than a half-acre in a municipality, or 160 acres elsewhere.

Personal Property Exemption allows up to $1000 equity of property- including furniture, art, and electronics.  Or $4000 IF the Homestead Exemption was not used.

Vehicle Exemption Up to $1000 in equity but more if you’re married filing jointly.  If all your equity is covered by a vehicle exemption, your car cannot be taken.

Wages Exemption State law limits the amount of wages that can be garnished by creditors.  Heads of household are fully exempt to up to $750 per week during the prior 6 months.

Pension/Retirement Accounts  401k’s are exempt, and IRA’s and Roth IRA’s are exempt up to $1,171,650.