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dkennedy
dkennedy, Attorney
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Experience:  15+ years experience
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Income has taken a serious hit over the last two years and

Resolved Question:

Income has taken a serious hit over the last two years and I have been slowing sinking, financially. I have a Texas `homesteaded` residence that I currently rent out while living in a condo to cut expenses. I also have a small investment in a commercial property LLP. These I share ownership with my ex-wife. These are my primary assets, though equity in both of these together is worth only about 140K.

If I file for bankruptcy Ch. 7 / 13 how are these properties affected down the road once sold? Assume neither to be sold until after bankruptcy closes. Could be a year, could be 5 years until that happens. trying to protect what left I have for my daughter's college fund.

Thanks.
Submitted: 1 year ago.
Category: Bankruptcy Law
Expert:  dkennedy replied 1 year ago.

Hello,

In a Ch. 7 bankruptcy you would likely not be able to keep your properties and investment would be sold by the bankruptcy trustee and distributed to your various creditors. That is, of course, if the properties are not exempt and they have some value. In a Ch. 13, which is called the "wage earner" bankruptcy sometimes, you would likely be able to keep the properties, while paying off your debts according to a plan. In the case of the Ch. 7 the properties would most likely be sold as soon as allowed by the bankruptcy court. That would take quite a while to do that and sell the "homestead" I would assume. What else can I specifically answer for you?

 

By the way, here are the TX exemptions, in a bankruptcy:

ASSET

EXEMPTION DESCRIPTION

LAW SECTION

Homestead

Unlimited; property cannot exceed 10 acre in town, village, city or 100 acres (200 acres for families) elsewhere; sale proceeds exempt for 6 months after sale (need not occupy if not acquire another home, Property 41.003)

May file homestead declaration

Property 41.001, 41.002

 

Property 41.005

Personal Property

Athletic and sporting equipment, including bicycles; 2 firearms; home furnishings, including family heirlooms; food; clothing; jewelry (not to exceed 25% of total exemption); 1 two-, three- or four wheeled motor vehicle per member of family or single adult who holds a driverís license (or who operates vehicle for someone else who does not have a license); 2 horses, mules or donkeys and a saddle, blanket and bridle for each; 12 head of cattle; 60 head of other types of livestock; 120 fowl; and pets to $30,000 total ($60,000 for head of family)

Burial plots

Health aids

Property 42.001, 42.002

 

 

 

Property 41.001

Property 42.001(b) (2)

Insurance

Church benefit plan benefits

Fraternal benefit society benefits

Life, health, accident or annuity benefits or monies, including policy proceeds and cash values to be paid or rendered to beneficiary or insured

Life insurance present value if beneficiary is debtor or debtorís dependent (see note under personal property)

Retired public school employees group insurance

Texas employee uniform group insurance

Texas state college or university employee benefits

1407a-6

885.316

Insurance 21.22

Property 42.002(a) (12)

Insurance 3.50-4(11) (a)

3.50-4(11),1575.006

1551.011

Insurance 3.50-3(9) (a)

Miscellaneous

Property of business partnership

6132b-25

Pensions

County & district employees

ERISA-qualified government or church benefits, including Keoghs and IRAs

Firefighters

IRAs to extent tax-deferred

Judges

Keoghs to extent tax-deferred

Law enforcement officersí survivors

Municipal employees

Police officers

Retirement benefits to extent tax-deferred

State employees

Teachers

Government 811.005

Property 42.0021

6243e(5), 6243e.1(12),

6243e.2(12)

Property 42.0021

Government 811.005

Property 42.0021

6228f(8)

6243g, Government

811.005

6243d-1(17), 6243j(20),6243g-1(23B)

Property 42.0021

Government 811.005

Government 811.005

Public Benefits

Crime victimsí award

Medical assistance

Public assistance

Unemployment compensation

Workersí compensation

56.49

Hum. Res. 32.036

Hum. Res. 31.040

5221b-13

8308-4.07

Tools of Trade

Farming or ranching vehicles and implements

Tools, equipment (includes boat & motor vehicles) & books

Property 42.002(a) (3)

Property 42.002(a) (4)

Wages

Earned but unpaid wages

Unpaid commissions to 75% (see personal property)

Property 42.001(b) (1)

Property 42.001(d)

Customer: replied 1 year ago.

Your answer states I would likely not be able to keep my properties then in the Texas Exemptions table you submitted it says my homesteaded property is exempted. Pardon my confusion but I'm assuming that the court would seize the LLC property and sell it while the homestead could still be held.


 


When the homesteaded property is eventually sold would the proceeds from that sale then be seized by the court at that later date?

Expert:  dkennedy replied 1 year ago.
You have to live on the property in order to claim it as homestead. That's what it means in "bankruptcy" terms. You could move back there, though.
dkennedy, Attorney
Category: Bankruptcy Law
Satisfied Customers: 6002
Experience: 15+ years experience
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