The Utah Legislature is about the pass a bill that increases the following exemption amounts for personal bankruptcy:
- Increases homestead exemption from $20,000 to $30,000 per individual;
- Increases vehicle exemption from $2500 to $3000 per individual;
- Increases furniture and other items of personal property exemption from $500 to $1000;
- Creates an exemption for firearms and ammunition up to $250 per individual;
- Creates an exemption for unpaid earnings;
- Creates an exemption for a motor vehicle used by an individual in the individual’s business, trade, or profession;
- Permits certain nonresidents to use the federal exemptions.
Read more about the bill here. Expanding the bill to cover firearms and ammunition is a positive step. In my opinion, this bill does not go far enough to provide an exemption for home owners with a reasonable amount of equity in their home. Exemptions vary by state, and although Utah’s exemption will now be greater than the federal exemption, it is still far below neighbor states Idaho ($50,000 per individual), Colorado ($45,000), and Nevada ($350,000). That said, increasing the homestead exemption to $30,000 will help a huge number of Utahns in protecting their hard-earned money.
Nobody wants to go through bankruptcy. Just like nobody wants to have their tonsils out. But- bankruptcy can be the tool that allows you to finally be able to step back and breathe again. Increasing bankruptcy exemptions is a positive step that will give people the opportunity to come out of bankruptcy with the tools necessary to build a successful and happy life.