Your Retirement Accounts Are Exempt
Video Transcribed: Hello, this is Edward Kelley I am a Bankruptcy Attorney Tulsa, I’ve been practicing bankruptcy law for over 15 years and I’m here to teach you some things about it. Before, I talked about How Do I File A Chapter 7, which ensured find a good attorney.
It’s a lot of paperwork and there’s a lot of easy mistakes that can cost you terribly, so this is probably one of those where you don’t want to do it yourself. It is possible to do so, I don’t necessarily recommend it unless you have some legal training. Okay.
As promised, today, we’re going to talk about What Property Can I Keep In A Bankruptcy And What Do I Have To Give Up To? What we’re talking about here is exemptions, which exempt means not privy to or not a part of. In a Chapter 7 bankruptcy, more popularly known as liquidation bankruptcy, you’ve got a trade-off.
I get all my debts wiped out a hundred percent, but I have to give up any collateral tied to those debts and also anything of value that I have that is not exempt or not a part of the bankruptcy. You get some pretty big and helpful exemptions that cover almost everything.
You’ve got a home exemption. Oklahoma’s one of the best, for all intents and purposes unlimited. Although, if you’re in the city, if you’re on more than an acre, you may have some issues. Out in the country, virtually unlimited. And your vehicles, we have a great vehicle exemption too.
You’re fine up to $7500 in equity, that means if you own a car outright, as long as it’s not worth more than $7500. Or if you do have a loan, if you sold the car and paid off the loan, if you would have no more than $7500 leftover, then you’re fine.
That covers most people, but that’s just one car per person per couple, and you can’t mix and match. You can’t have one car worth $15,000 and spread it out over the two people in the couple. $7500 max per person.
And the home, again, that’s not really a question of a couple splitting that. That’s the homestead. I’ll talk in another video if you’re separated and have separate households, but you have standard exemptions.
I won’t go into great detail, but they don’t take your TV, they don’t take your silverware, they don’t take your furniture. Normal household goods are fine. What you will run into problems with our boats, RVs, trailers, assuming you don’t live in those, in which case they would be exempt. Jet skis. Oil royalties, they always go for those.
Tax refunds, any kind of savings. Your retirement accounts are exempt, so as long as they’re in a proper IRA, you’re good. You can have as much as you want in there in Oklahoma. But if you just have money in the bank or money under the mattress, that stuff’s not exempt.
In short, most people that come to me for bankruptcy don’t have any of those assets that are not exempt, and everything that they need to survive and exist as a family or as an individual is exempt anyway.
Of course, as I said at the beginning if you want to do a Chapter 7, I highly suggest you hire an attorney, preferably myself, and we can go through everything you’ve got and make sure what’s exempt and what’s not and know what we’re doing before we file.