If you’re thinking of filing for bankruptcy protection, the thought of losing all of your assets might give you second thoughts. Fortunately, bankruptcy law allows you to exempt a wide range of personal property, so many petitioners get the debt relief they need without surrendering anything at all. In Alabama, the following exemptions determine which assets you get to keep in a Chapter 7 filing, or how much you’ll owe your creditors in a Chapter 13 bankruptcy.

Property Exempt Under Alabama’s Bankruptcy Law

The Homestead Exemption

Each individual on the petition is allowed to claim $15,000 in equity in your primary place of residence. Married couples filing jointly may exempt up to $30,000 in equity, as long as the property is less than 160 acres.

Personal Property

Your private belongings, including pre-purchased property such as burial sites, are exempt. The trustee also won’t be able to seize your clothing, books, family photos, or other personal effects.

Retirement Savings

Tax-exempt retirement accounts, such as 401(k)s, SEPs, and SIMPLE IRAs, are exempt from seizure. Roth IRA funds are also exempt, as are most pension accounts for public employees, teachers, and judges.

Insurance Proceeds

Death benefits from a life insurance policy are exempt from seizure, as well as the cash value of whole life policies if the terms prohibit the use of those funds to pay creditors. You may also exempt annuity proceeds and disability benefits of up to $250 per month, but married couples can double these amounts.

Wildcard Exemptions

In addition to the other exemptions, Alabama bankruptcy allows each individual in the petition to claim $7,750 in personal property, which can be applied to any assets you choose. This may include electronics, jewelry, artwork, and family heirlooms.

Since 1982, Ray T. Kennington, Attorney At Law has been helping borrowers throughout the Ozark area get the debt relief they need. With his strong background in bankruptcy law, he has the expertise to help you keep as much of your property as possible. To schedule a consultation, visit the firm’s website and call (334) 445-1200 for more legal tips and bankruptcy advice.