New Jersey Bankruptcy Exemptions Attorneys

Debtors who file bankruptcy in New Jersey can use either federal exemptions or state exemptions. Exemptions are assets that are not subject to liquidation in bankruptcy. Exempt property is protected from creditors.

New Jersey bankruptcy filers nearly always choose to use the federal bankruptcy exemptions rather than the state's exemptions. One important reason for this has traditionally been that New Jersey has no real estate exemption. This means that equity in a home is not protected from potential liquidation in a Chapter 7 bankruptcy. (This is less of an issue in today's economy than it used to be, since a great many mortgage holders no longer have equity in light of the depressed housing market.)

Below is a simplified sampling of federal and state bankruptcy exemptions that may apply in a New Jersey bankruptcy. It is readily apparent why federal exemptions are more advantageous for the majority of our clients at Goldman & Beslow, LLC.

Exemptions in bankruptcy New Jersey state exemptionsFederal exemptions
Real estateNo exemption.Homestead exemption: property or equity up to $21,625.
PensionsAll are exempt.All are exempt.
Wages90 percent of an income that is less than 250 percent of the federal poverty level; 75 percent of an income that is more than 250 percent of the federal poverty level.No exemption.
Tools of a tradeNo exemption.Implements, tools and books, up to $2,175 worth.
Personal propertyAll clothing. Personal property up to $1,000 worth. Furniture up to $1,000 worth.Up to $11,525 total; in addition, up to $10,825 of unused homestead exemption.

Classifying property as personal property versus tools of a trade is not as cut and dried as it may seem to be. It is important to consult with an attorney with ample experience in bankruptcy law.

For debtors who are concerned that their assets are worth much more than what is allowed through exemptions, there are a couple of good options:

  • File Chapter 13 bankruptcy and keep all your assets.
  • Before you file a Chapter 7 bankruptcy, speak with an attorney about bankruptcy planning.

In practice, rarely if ever do any of our clients lose assets in a Chapter 7 bankruptcy, thanks to the allowable federal bankruptcy exemptions.

Contact Our Northern And Central New Jersey Chapter 7 and 13 Bankruptcy Attorneys

From our law offices in East Orange, Paterson, New Jersey and Newark, we advise clients on how to save assets by applying bankruptcy exemptions. Call our experienced Essex County, New Jersey, bankruptcy lawyers today for a free one-half hour consultation at 973-414-8069 or 888-827-5493. Our lawyers serve Essex, Union, Hudson, Passaic, Bergen, Morris, Middlesex, Sussex and other New Jersey counties.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.