What can I keep if I file Bankruptcy?  Can I keep cash, tax refunds or bank accounts?

I am an attorney at the Northwest Indiana law firm of Schlyer & Associates and we help people file for bankruptcy relief in Lake and Porter County, Indiana.  We all know somebody who filed for bankruptcy relief or someone who knew someone who filed for bankruptcy and told you all about it.

Most likely, what you have been told is not completely true. I want to talk about some of the basic rules relating to property.  The majority of this information relates to a Chapter 7 (if you live in Indiana), the type of bankruptcy where you do not have a repayment plan.

In Bankruptcy, you are entitled to certain exemptions on property.  If your property’s value is exempt, that means that a creditor, a Trustee or the Court cannot take that property from you, make you sell it or make it a part of your bankruptcy estate (to be distributed to creditors).

Intangible property, like cash, including available balances in bank accounts, is currently exempt up to $350.00 in Indiana.  This means if you file bankruptcy and you have $1,000.00 available in your checking account, the Trustee in your case can demand that you turn over $650.00 to him to distribute to your creditors.

Your exemption for cash is currently $350.00, so only that amount is protected from distribution.  Tax returns are considered intangible property.  Therefore, if you file bankruptcy before you receive that year’s income tax return, you would not be able to cash that refund without the Trustees’ permission because he has to determine how much he is entitled to take for the benefit of your creditors.

In Indiana, all money received due to Earned Income Credit is exempt, meaning the Trustee cannot take and administer those funds.  However, if the actual income tax refund is more, the Trustee has the right to take that portion of the refund.

Please call us at Schlyer & Associates to make an appointment with one of our lawyers to discuss your other available exemptions and property you can keep under the bankruptcy laws and how we can help.  We offer free face to face consultations in our office.

The attorneys at Schlyer & Associates can help you file Chapter 7 and Chapter 13 bankruptcy, if you live in Lake County or Porter County, Indiana.  Please feel free to contact us today at (219) 757-0225 if you or your loved one was injured or needs to file bankruptcy.

We can help you file Chapter 7 or Chapter 13 bankruptcy if you live in the Lake County or Porter County communities of Hammond, East Chicago, Gary, Munster, Griffith, Highland, Dyer, St. John, Schererville, Cedar Lake, Lake Station, Crown Point, Merrillville, Hobart, New Chicago, Lowell, Lake Dalecarlia, Winfield, Miller, Lake Village, Valparaiso, Hebron, Dune Acres, Kouts, Odgen Dunes, Chesterton, Town of Pines, Portage, Porter, Wheeler, South Haven or Beverly Shores.

We are located at 200 West 80th Place, Merrillville, Indiana   46410.  Our office is located across the street from Eye Care Plus and Spill the Beans gourmet coffee shop.   Our main office is located at 200 West 80th Place, Merrillville, Indiana   46410.

Posted by Bankruptcy Attorney Jennifer Eversole