Bankruptcy and Assets: Be Clear on What You Can Keep in Wisconsin Bankruptcy
If you’re considering bankruptcy in Wisconsin, it’s crucial to understand the nuances of bankruptcy exemptions, which determine what assets you can retain when filing for Chapter 7 bankruptcy. In this comprehensive guide, we’ll explore the Wisconsin bankruptcy exemptions, how they work, and why they are vital in a Chapter 7 bankruptcy proceeding.
Bankruptcy and Assets: Protecting Your Asset (Wisconsin Bankruptcy Exemptions)
When you file for Chapter 7 bankruptcy in Wisconsin, your assets become part of the bankruptcy estate, and a trustee is appointed to manage your non-exempt property’s sale to repay your creditors. However, the good news is that bankruptcy exemptions exist to protect certain assets, ensuring you don’t lose everything in the process. These exemptions are specific laws designed to safeguard your property, including retirement accounts and personal belongings, from liquidation.
Bankruptcy and Assets: Does Wisconsin Allow Federal Bankruptcy Exemptions?
One unique aspect of Wisconsin bankruptcy law is that it allows you to choose between federal bankruptcy exemptions and state exemptions. Unlike some states that “opt out” of the federal scheme, Wisconsin residents can select the exemption scheme that best suits their needs. However, it’s essential to note that you cannot mix and match exemptions from both lists. You must choose either federal or state exemptions, not a combination of both. This flexibility is advantageous for Chapter 7 filers in the state, offering more protection for their assets.
If you’re filing for bankruptcy in Wisconsin, it’s advisable to review both sets of exemptions thoroughly and select the one that provides the most comprehensive safeguard for your property. In this complex decision-making process, hiring an attorney can be particularly helpful.
Bankruptcy and Assets: Wisconsin Bankruptcy Exemptions in Detail (Assets You Can Keep After Bankruptcy)
Let’s delve into the specific exemptions available under Wisconsin law:
Real Property – The Wisconsin Homestead Exemption (Your Home)
One of the most critical exemptions for Wisconsin residents is the homestead exemption, which protects the equity in your primary residence. In Wisconsin, an individual filer can exempt up to $75,000 in the value of their homestead, while a couple filing jointly can claim up to $150,000. However, this exemption is applicable only to your primary residence, not investment properties.
The state’s homestead exemption also limits the property size to forty acres, with the primary dwelling and the necessary surrounding land covered by the exemption.
Wild Card Exemption
The wild card exemption holds a unique place in Chapter 7 bankruptcy. It allows you to protect assets that wouldn’t typically fall under standard exemptions. While Wisconsin doesn’t have a specific wild card exemption, you can apply the federal wild card exemption, which allows you to protect up to $1,475 of any property. Additionally, if you choose not to use the homestead exemption, you can apply an additional $13,950 as a wildcard benefit.
Bankruptcy and Assets: Personal Property Exemptions
Wisconsin bankruptcy exemptions also cover various personal property assets:
Wisconsin bankruptcy laws protect the equity in your vehicle when filing for Chapter 7 bankruptcy. You can safeguard up to $4,000 in equity for any motor vehicle you own. If you’re married and filing jointly, you can double this exemption to $8,000. Furthermore, Wisconsin law allows filers to exempt up to $12,000 in personal property, which can be applied to your motor vehicle.
Other Personal Property
Personal property exemptions in Wisconsin cover items such as furniture, electronics, jewelry, household goods, and more. You can protect up to $12,000 in aggregate value for tangible personal property used for family or personal use. This category encompasses a wide range of items, including household goods, furnishings, apparel, musical instruments, firearms, animals, and sporting goods.
Bankruptcy and Assets: Money Benefits
Wisconsin offers exemptions for various financial benefits:
- Veterans’ benefits and war pensions are exempt.
- Pensions for firefighters, municipal employees in larger cities, and police officers are protected.
- All pensions for public employees enjoy exemption status.
- Tax-exempt retirements are exempt as well.
Bankruptcy and Assets: Insurance
Several insurance-related exemptions apply in Wisconsin:
- Federal disability insurance proceeds are exempt.
- Fraternal society benefits are protected.
- Fire insurance proceeds for destroyed exempt property are exempt for two years.
- Life insurance policies are exempt up to $5,000 if the beneficiary is a married woman.
- Unmatured life insurance contracts are exempt.
- Life insurance proceeds are exempt if the beneficiary was dependent on you.
Bankruptcy and Assets: Wage Exemption
Under Wisconsin law, you can protect up to 75 percent of your weekly income if it’s necessary for your support. This exemption cannot be less than thirty times the higher of the federal or state minimum wage.
Bankruptcy and Assets: Prisoner Property
Wages earned during imprisonment are protected under Wisconsin law.
Bankruptcy and Assets: Alimony and Child Support
Wisconsin considers child support and alimony crucial for the well-being of bankruptcy filers and their dependents. These payments are exempt to the extent that they are reasonably necessary for ongoing support.
Bankruptcy and Assets: Other Wisconsin Exemptions
Wisconsin bankruptcy law also includes exemptions for family businesses, trade implements, tools, professional books, equipment, burial facilities, cemetery plots, coffins, and tombstones intended for personal or family use.
Bankruptcy and Assets: Filing Chapter 7 Bankruptcy in Wisconsin
Filing for bankruptcy in Wisconsin can be a complex and time-consuming process. It’s essential to focus on both protecting your assets and regaining your financial stability. To navigate the intricate details of bankruptcy law and make informed decisions about exemptions, it’s advisable to consult with a bankruptcy attorney in Wisconsin.
An experienced attorney can help you:
- Understand and choose between Wisconsin state and federal bankruptcy exemptions.
- Determine the most suitable bankruptcy chapter, whether Chapter 7 or Chapter 13.
- Guide you through the bankruptcy process, including preparing the necessary forms.
- Achieve the best possible outcome for your case.
- Resolve your case efficiently, minimizing stress and complications.
Conclusion on Bankruptcy and Assets
In Wisconsin, bankruptcy filers have the advantage of choosing between federal and state bankruptcy exemptions, offering flexibility in asset protection. However, navigating these exemptions and making the right choices can be challenging. It’s crucial to seek legal counsel to ensure you make informed decisions that align with your financial goals and preserve your valuable assets.
For expert guidance and assistance with your Wisconsin bankruptcy case, we encourage you to contact Attorney Steven Eichstaedt at Dahlberg Law Group at (262) 677-8999. They have the experience and knowledge to help you achieve a fresh start and protect your assets throughout the bankruptcy process.
- Wisconsin Bankruptcy FAQs
- Wisconsin Court System – Pro Se Forms
- Dahlberg Law Group – Contact lawyers at Dahlberg Law Group to help with your bankruptcy case.