Category Archives: California 2013 Bankruptcy Exemptions Increase

Increased Bankruptcy Exemptions in California as of April 2013


In January 2013 California Assembly Bill 929 increased the exemptions available to protect your property in California. As of April 1, 2013, the exemptions available increased even more under California Civil Procedure sections 703 and 704. This is great news to a lot of people who were thinking of filing for bankruptcy protection. Your bankruptcy lawyer will now have more options to protect your assets. It may provide some comfort knowing that more assets can be protected. Here are some of the changes as of April 1, 2013:

California C.C.P. §703.140 Exemptions:
• $25,075 in homestead or burial plot (previously $24,060). This means that if you have any equity in your residential property you can use this exemption to protect the equity.
• $26,425 wildcard exemption: this exemption consists of $1,350 plus any unused portion of the $25,075 homestead or burial plot exemption (previously $25,340).
• $5,100 in one or more motor vehicles (previously $4,800).
• $650 in any single item of household goods (previously $600). Note this is per item; if the current market values of all of your household goods are less than $650 each they are all protected.
• $1,525 jewelry (previously $1,425)
• $7,575 tools of trade (previously $7,175)
• $13,675 unmatured life insurance policies (previously $12,860)
• $25,575 personal injury payments (previously $22,075)

California C.C.P. §704.730 Exemptions:
• $2,900 motor vehicle exemption (previously $2,725)
• $7,625 jewelry, heirlooms, and works of art (previously $7,175)
• $7,625 tools of trade for only one spouse (previously $7,175)
• $15,250 tools of trade for both spouses (previously $14,350)
• $1,525 public benefits for one payee (previously $1,425)
• $2,275 public benefits for joint payees (previously $2,150)
• $3,050 social security benefits for one payee (previously $2,875)
• $4,575 social security benefits for joint payees (previously $4,300)

Since the publishing of this article, the homestead and burial plot exemption under §703 have increased to $25,575 from $25,075. This means that the wildcard exemption can be up to $26,925. The wildcard exemption consists of any unused portion of the homestead exemption above plus $1,350. The tools of trade and professional books exemption has also increased to $7,625 from $7,575.

The exemptions above are only some of the changes; it does not encompass all the changes of exemptions. The homestead exemptions under CCP §704 remain the same: $75,000 for a single person, $100,000 if you are a member of family unit where one or more members of the family do not own an interest in the homestead or whose only interest is a community property interest or $175,000 if: 1) you are 65 years or older, 2) physically or mentally disabled and cannot work as a result, or 3) 55 years or older with gross annual income of less than $25,000 for a single person or $35,000 if married and there is an attempted involuntary sale. With home prices on the rise in most areas your bankruptcy attorney will most likely recommend obtaining an appraisal.

Since you have to choose CCP §703 or CCP §704 exemptions (you cannot use both) it is generally beneficial to use the CCP §703 exemptions because there is the generous wildcard exemption to protect more of your assets unless you have a home that has a lot of equity that needs to be protected. Your bankruptcy attorney would be able to help you determine which of these exemptions to use to benefit your situation the most.