Posts Tagged ‘bankruptcy exemptions in Iowa’

Iowa Bankruptcy Exemptions

When a court declares you bankrupt in the state of Iowa under chapter 7 of the bankruptcy code, you are entitled to certain Iowa bankruptcy exemptions. As soon as the final order comes from the court, the control of all your assets and properties goes to the hand of the bankruptcy trustee. It is important to note that unlike other states, Iowa does not allow you to use federal set of exemptions instead of the exemptions allowed by the state of Iowa itself. However, you can use the federal supplemental exemptions in addition to the state-specified exemptions. You can get the exemptions as per the following provisions.

Wildcard

Iowa allows you to exempt any tangible personal property (in addition to the personal property exemptions) up to a maximum value of one thousand dollars.

Wages

Salary or wages of a prisoner is 100% safe. For others, Iowa laws have specified how much can NOT be exempted per year in the following manner:

- Up to 10% if the wage amount is more than $50000
- Up to $2000 if between $35,000 to $50,000
- Up to $1000 if between $24,000 to $35,000
- Up to $800 if between $16,000 to $24,000
- Up to $400 if between $12,000 to $16,000
- Up to $250 for wages up to $12000

Tools Of Trade

A maximum of $10000 is exemptible for non-farming equipment. Besides that, you can also exempt feed, livestock and other farming equipment up to a maximum value of $10000.

Public Benefits

Certain types of public benefits are exemptible in full, such as workers’ compensation, veterans’ benefits, unemployment compensation, social security, any public assistance benefit, aid to dependant children, and adopted child assistance.

Personal Property

Iowa bankruptcy exemptions are available for the following personal assets and properties.

- Wrongful death proceeds up to the extent that is needed for support
- A maximum $500 in utility security deposit, or up to that much amount in terms of house rent given in advance
- Jewelry items are also safe up to a maximum value of $2000
- Engagement and wedding rings are also safe up to a maximum value of $7000, but only if the rings were purchased at least two years before filing bankruptcy petition or purchased after marriage.
- 100$ exemptions can be availed for shotgun, musket, and rifle.
- If you are receiving any health aids, it I also 100% safe when you go bankrupt.
- You can also keep up to one acre of burial plot
- Painting, pictures, portraits, books, and bibles can be exempted up to a maximum value of $1000 (aggregate total, no individual limit)
- You can also exempt storage containers, clothing, household furnishing, appliances, musical instruments, and other such personal properties up to a maximum value of $7000 (in aggregate total, no individual limit).

Pensions

As per Iowa bankruptcy exemptions, certain pensions are also exemptible in full, such as the pension received by public employees, police officers, peace officers, firefighters, and federal government employees. Roth IRAs, traditional IRAs, and other tax-exempt retirement accounts are exemptible up to $1,095,000 per individual.

Miscellaneous

In this category, you can get full exemptions for liquor licenses. Besides that, you can also exempt child support and alimony payments up to the extent that is needed for support.

Insurance

100% exemptible insurance benefits include fraternal benefit society benefit and employee group insurance proceeds or policy. Life insurance proceeds can also be exempted in full provided there is a specific clause in the policy contract that prohibits the use of the proceeds to pay off loans. If you do not meet this condition, you can still get life insurance proceeds exempted up to a maximum value of $10000 provided the policy was taken within two years of bankruptcy filing and if the proceeds are payable to dependent family members of the debtor, such as child or spouse.

Homestead

Iowa bankruptcy exemptions allow you to exempt up to half acre in a town or city or up to forty acres if located elsewhere. There is no maximum limit in terms of the value of equity that you have in that property.


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