5 Bankruptcy Exemptions in Florida

As noted previously, Florida is one of the states which opt to use its own state bankruptcy exemptions instead of the federal bankruptcy exemptions.

Florida allows a complete exemption for one’s homestead property – up to one half acre in an incorporated municipality and up to 130 acres if the property is not in an incorporated municipality.  While the Federal law respects this, there are exceptions.

In order to qualify for your state’s exemption, you must have made that state your permanent residence for at least two years.  If less than two years but more than 91 days, you must use the exemptions of the state where you were domiciled for the better part of the 180 day period immediately prior to the two year period.

Even if you qualify, Federal law now puts a restriction on the amount of an exemption for homestead property.

1. If you acquired your Florida home less than 1215 days prior to filing, then you are limited to a homestead exemption of $136,875, regardless of the value of the house.
2. You are also limited to this $136,875 if you were convicted of a felony under circumstances which demonstrate that the filing of the case was an abuse, or if the debtor owes a debt arising from a violation of Federal or State securities laws or regulations, or if the  debtor owes a debt arising from fraud, deceit or manipulation in a financial capacity with regard to the purchase or sale of a security, or a criminal act, intentional tort, or willful or reckless misconduct which caused serious physical injury or death to another individual in the preceding five years.
   1. Exception to this exception – this does not apply to the extent that the interest in the property is reasonably necessary for the support of the debtor or a dependent of the debtor

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Notwithstanding Florida’s opting to use its own bankruptcy exemptions, it allows debtors to avail themselves of the federal bankruptcy exemption for:

1. Social Security benefits, unemployment compensation or local public assistance benefits
2. Veteran’s benefits
3. Disability, illness or unemployment benefit
4. Alimony, support or separate maintenance to the extent reasonably necessary for the support of the debtor or any dependant of the debtor.
5. Payment under stock bonus, pension profit sharing, annuity or similar plan or contract on account of illness, disability, death, age or length of service to the extent reasonably necessary for the support of the debtor and any dependent of the debtor.

Tags: bankruptcy exemptions, Bankruptcy in Florida, exemption for homestead property in Florida, federal bankruptcy exemptions, Florida bankruptcy, Florida bankruptcy exemptions

Posted in Filing Bankruptcy in Florida