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Wilma has the following assets: a house with equity of $14,250, a car with equity of $2,700, and household goods worth $9,000 (no single item over $400). She also has jewelry worth $1,100 and other property worth $900. She has no tools used for work. Using the federal list, the total amount of exemptions that Wilma would be allowed is $ .00. Using the state list, the total amount of exemptions that Wilma would be allowed is $ .00. The federal list will be more favorable for her.

Respuesta :

anthougo

1. Using the federal list, the total amount of exemptions that Wilma would be allowed is $26,450.

2. Using the state list, the total amount of exemptions that Wilma would be allowed is $25,350.

3. The federal list will be more favorable for her.

Data and Calculations:

                    Wilma's Assets    Federal List      State List

Equity in house = $14,250          $14,250          $14,250

Car =                      $2,700              2,400              1,500

Household goods

(limited to $400 for a

 single item) =     $9,000              8,000             9,000

Jewelry =               $1,100               1,000                500

Other property =    $900                 800                 100

Total                  $27,950         $26,450        $25,350

Question Completion:

LIST A. FEDERAL EXEMPTIONS

Equity in home .......................................$15,000

Motor vehicle .............................................2,400

Household goods .......................................8,000

($400 limit for a single item)

Jewelry .......................................................1,000

Other property ..............................................800

Tools (for debtor’s trade) ...........................1,500

Total Federal Exemptions = $28,700

LIST B. STATE EXEMPTIONS

Equity in home ....................................... $25,000

Motor vehicle ............................................. 1,500

Household goods ..................................... 10,000

($1,000 limit for a single item)

Jewelry .......................................................... 500

Other property .............................................. 100

Tools ........................................................... 5,000

Total State Exemptions = $42,100

Thus, in computing exemptions under the Chapter 7 bankruptcy, Wilma should choose the federal list instead of the state list because the federal list is more favorable with higher exemptions than the state list.

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