One of the main policy objectives of Bankruptcy is to give debtors a fresh start with sufficient assets to function sucessfully in society. Different state legislatures have codified this general concept into exemption laws for their residents. In Texas, residents are allowed to choose between two exemption systems: (1) The Federal Exemptions; and (2) The Texas Exemptions.
In addition to a number of specific property exemptions, Federal exemptions also allow for a “Wildcard” exemption under section 522(d)(5). The wildcard allows you to exempt any property which is otherwise not specifically provided for under the exemption system. Most other property that people have is provided for under the Federal Exemptions (household goods, clothes, personal items, jewelry, equity in home, etc).
The dollar amount for wildcard exemption is currently set at $1125 per person filing ($2250 per married couple). In addition the wildcard allows you to use the unused portion of your federal homestead exemption (up to $11,500 for an individual and $23,000 for a married couple). This adds up to a very large amount for anybody who does not own a home or who has very little equity in their home.
The most common uses for the wildcard exemption include money in your bank account and an income tax refund, however, it can also be used for things like a boat, motorcycle, extra car, firearms or any other kind of property.
Consult with the Law Office of Howard Tagg at 903-581-9961 to go over your personal and real property and determine what exemption system is right for you. We are experts in ensuring you get all the property you are entitled to the under the law.