Under NJ bankruptcy law, there are two exemption schemes that you can use to keep your personal property. An exemption scheme allows you to keep up to a certain dollar amount of some personal property and the entire amount of other personal property. You can choose the exemption scheme that will benefit you the most based on your current circumstances.
First Exemption Scheme
The first exemption scheme allows you to claim fewer exemptions than the second exemption scheme. Under NJ bankruptcy law, you can exempt the property included in this scheme so that it is not taken away from you to pay your debts. Under the first scheme, you can exempt the following property:
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Tools of your trade valued at up to $1,850 - This allows contractors, mechanics, and other professionals who need tools to keep them on hand so that they can continue earning an income.
Motor vehicle valued at up to $2,950 - This is helpful if you need to keep your vehicle to get to work or transport your family to school, medical appointments, and other locations.
Health and medical devices - You are allowed to keep all of the devices that help you maintain your health. This can include canes, walkers, diabetic supplies, and oxygen tanks.
Your home up to $18,450 - This allows you to keep your primary home so that you still have a place to live after you have filed for bankruptcy.
The first exemption scheme also allows you to exempt life insurance payments for the person who supported you financially, unmatured life insurance contracts, alimony and child support needed for support, ERISA-qualified benefits needed for support, household goods up to a total of $9,850 (limited to $475 maximum per item), jewelry up to $1,225, and a wild card that is $925 of any personal property or up to $9,250 of any unused homestead exemption.
Second Exemption Scheme
The second exemption scheme allows you to keep additional personal property. Under the second scheme, you can exempt the following property in accordance with NJ bankruptcy law.
Clothing - This gives you the opportunity to keep clothing needed for work, school, and special events.
Crime victims' compensation - This allows you to keep any compensation you received due to being the victim of a crime.
Burial plots - This allows you to retain the interest you have in any burial plots designated for you or your family members.
Annuity contract proceeds - This exemption allows you to continue receiving up to $500 per month of annuity contract proceeds.
Other exemptions available under the second exemption scheme and NJ bankruptcy law include up to $1,000 of shares of stock or interest in a corporation, household goods and furniture up to $1,000, public employees' pensions, ERISA-qualified benefits, property of a business partnership, health or disability benefits, disability or death benefits for military personnel, disability or death benefits for civil or government employees, group life or health policy proceeds, and wages and allowances received by military personnel.
NJ bankruptcy law can be difficult to understand. If you need more information, contact a local bankruptcy attorney for more details.
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