Those who file for bankruptcy in Colorado are required, per Colorado laws, to use state laws (rather than federal bankruptcy statutes) when claiming property and asset exemptions. These bankruptcy exemptions refer to assets and property that will not be liquidated as part of a Chapter 7 bankruptcy proceeding in order to pay off creditors (i.e., debtors can keep these exempt assets). Although these values for these exemptions are frequently updated, the following are some of the most common types of bankruptcy exemptions that can be claimed, along with the currently maximum value of assets that can be exempt from a bankruptcy case:
- Residential property – Up to $60,000 in equity of a debtor’s home can be exempt from bankruptcy (or up to $90,000 if the debtor has a spouse or dependent who is older than 60 years old and/or who is disabled).
- Insurance benefits – While 100 percent of a group life insurance policy and life insurance proceeds are exempt from a bankruptcy estate, up to $200 per month from disability insurance is also exempt.
- Motor vehicles – Up to $5,000 in equity for motor vehicles is exempt from a bankruptcy estate (or up to $10,000 can be exempt if the petitioner is elderly or disabled or has an elderly or disabled spouse or dependent).
- Work tools – Up to $20,000 in tools used for work purposes (also referred to as “tools of the trade”) can be exempt from a bankruptcy estate.
Knowing what you can exempt from your bankruptcy estate can be critical to helping you maintain as much of your property and assets as possible as you work towards discharging much of your debt, including credit card debt, medical bills, etc.
Colorado Bankruptcy Lawyers
If you are overwhelmed by seemingly insurmountable debt and are looking for a financial fresh start, contact the trusted Colorado debt relief and bankruptcy lawyers at the Law Office of Jon B. Clarke, P.C. Our experienced legal professionals are committed to providing each of our Clients with the debt relief assistance they need, and we will work tirelessly to ensure that our Clients’ cases are resolved as favorably and efficiently as possible. For a thorough assessment of your situation, along with expert advice regarding the best manner in which to move forward to unburden yourself from debt, call us at (866) 916-3950.