The public policy of bankruptcy law contains the fundamental principle that Americans should have the ability to get a fresh start when burdensome financial concerns become too overwhelming. Any concerns that Utah residents may have about sacrificing certain property assets in a bankruptcy case can be tempered by the fact that bankruptcy law allows those who file bankruptcy the right to retain or “exempt” property that is necessary for everyday living. The law includes “exemptions” for household goods and furnishings that permit debtors to retain important personal property assets.

Many people believe that filing bankruptcy will cause them to lose most, if not all, of their valuable material possessions. They are afraid that the loss of this property will cause their dependents to lack important necessities and suffer a decrease in their quality of life.

Exemptions allow Utah residents and bankruptcy debtors to keep important assets necessary for a fresh start. Utah law provides a set or system of exemptions for all Utah residents who file Chapter 7, 11, 12, and 13 bankruptcy cases.

While both state law and federal law contain exemptions, Utah specifically requires that Utah bankruptcy debtors use the Utah state exemptions instead of the federal exemptions, which other jurisdictions make available to their residents.

When bankruptcy debtors exempt property, they are choosing to exclude it from their bankruptcy estate. Any property in their bankruptcy estate may be liquidated, and the proceeds used to pay creditors. Thus, exempt property is excluded from the Chapter 7 liquidation process, and debtors may continue to keep and use the property as they did prior to the filing of their bankruptcy case.

Utah Exemption Act permits debtors to claim the following personal property as exempt:

• clothes washer and dryer;
• refrigerator;
• freezer;
• stove;
• microwave oven; and
• sewing machine;
• all carpets in use;
• provisions sufficient for 12 months actually provided for individual or family use;
• all wearing apparel of every individual and dependent, not including jewelry or furs; and
• all beds and bedding for every individual or dependent;
• except for works of art held by the debtor as part of a trade or business, works of art:
  • depicting the debtor or the debtor and the debtor’s resident family; or
  • produced by the debtor or the debtor and the debtor’s resident family;

While the above items are not limited by their value, the following personal property is limited to a value of $500 for an individual debtor and $1,000 for those filing jointly:

• Sofas, chairs, and related furnishings reasonably necessary for one household.
• Dining and kitchen tables and chairs reasonably necessary for one household.
• Animals, books, and musical instruments, if reasonably held for the personal use of the individual or his dependents.
• Heirlooms or other items of particular sentimental value to the individual.

We all work hard to earn money to provide useful resources for ourselves and our families. Claiming exemptions in a bankruptcy case is crucial to any debtor’s retention of these valuable property resources. The attorneys at the Morrison Law Group can help anyone considering bankruptcy maximize their Utah property exemptions and retain the greatest amount of property permitted by state and federal law.

Why should you consider the Morrison Law Group? We are passionate about helping people. The team of attorneys and staff at the Morrison Law Group cares about its clients. We strive for complete client satisfaction. Call 801.456.9933 today to schedule a FREE consultation. We have locations in Ogden, Logan, Sandy, and St. George to serve the residents of the counties of Weber, Cache, Salt Lake, Utah, Morgan, Davis, Washington, and surrounding areas.