When deciding whether to file for bankruptcy, one of the major concerns Arizona residents may have is which of their assets they may retain -- they may hesitate at the thought of selling off all their possessions to satisfy their creditors. However, the list of bankruptcy exemptions is quite thorough for Arizona residents, meaning that they may keep many of their possessions during bankruptcy proceedings.
A recent ruling by the 9th U.S. Circuit Court of Appeals made the importance of bankruptcy exemptions clear. The court decided that under Arizona law, annuities and life insurance policies naming children as beneficiaries, whether they are legally dependent or not, are shielded from creditors in the event of a bankruptcy filing.
Knowing the bankruptcy exemptions under law is important for people considering their options while struggling with debt. In difficult times, potential filers take comfort from retaining belongings that have sentimental value for them, such as a wedding or engagement ring, if it is less than $1,000 in value.
In addition to this, Arizona residents can also keep common household assets, such as one motor vehicle that is less than $5,000 in value, one bicycle, a television, radio or stereo, stove, washing machine, dryer, and a refrigerator. Where a married couple is filing, the law allows each spouse to retain one of these items.
Musical instruments and books, published items and manuals can also be kept, depending on their value. In addition to this, filers can even keep possession of a religious book.
Not only is the law is very thorough when it comes to determining bankruptcy exemptions, the list of exemptions is also long. Arizona residents struggling with the decision may wish to consult an attorney to value their items, but they would be wise to consider taking any steps possible to wipe out their bills and begin their financial life afresh.
Source: Arizona Daily Star, "Annuities, life policies get shield in bankruptcies," August 25, 2012