Bankruptcy exemptions · Beverly Hills
Bankruptcy Exemptions in Beverly Hills That Protect Your Home, Car and Retirement
Bankruptcy exemptions (protect your home, car, retirement) decide what you keep when you file in Beverly Hills. California gives you two systems and you must choose one. Call (310) 362-9071 for a free consultation, and we will compare both against what you own before anything is filed.
- Equity in the home you live in, up to a limit
- Equity in a car, up to a limit
- Most retirement accounts
- Household goods, clothing and tools of your trade
- Some cash and bank funds
California's two exemption systems
California does not let you use the federal exemption list. Instead, you choose between two state systems, often called the 704 and 703 exemptions after the code sections that hold them.
System 1 (704)
Built around the home. It has a large homestead exemption for the place you live, plus protection for a car, household goods and retirement. It usually fits homeowners with equity.
System 2 (703)
Built around flexibility. The homestead is much smaller, but a "wildcard" can protect cash, savings, tax refunds or any other property. It usually fits renters and people with little home equity.
You pick one
You cannot mix the two. Married couples must agree on the same system. The wrong choice can cost you property that the other system would have protected.
How we choose your exemptions, step by step
- List what you own. Home, cars, bank accounts, retirement, household goods, tools, expected tax refunds and any claims you have against others.
- Value it fairly. We use realistic values, such as recent sales for a home and used-car guides for a vehicle, and subtract loans.
- Run both systems. We apply each set of exemptions to your list and see what each one leaves unprotected.
- Pick the better fit, or change the plan. If both systems leave something exposed, we look at timing, Chapter 13 or other options before filing.
- Claim it correctly. Each exemption is listed by code section on your schedules, so the trustee can see what is protected and why.
Exemptions for Beverly Hills and Los Angeles homeowners
California's 704 homestead amount is tied to home prices in your county, between a minimum and a maximum that are adjusted each year for inflation. Because home prices in Los Angeles County are high, local homeowners usually qualify for the top of that range.
There is also a residency rule. You generally must have lived in California for the two years before filing to use California's exemptions. If you moved here more recently, the exemptions of the state you came from may apply, and we sort that out first.
Your case is filed in the Los Angeles Division of the U.S. Bankruptcy Court, Central District of California. The trustee and creditors have a limited time after the 341 meeting to object to an exemption, which is one more reason to claim them carefully the first time.
Cost and timeline
Choosing and claiming exemptions is part of every case we file, under our flat fee from $1,200 plus the court filing fee. Cases with significant home equity, rental property or business assets take more work, and we tell you the fee in writing before you hire us.
Exemption mistakes to avoid
- Moving money right before filing. Shifting cash into exempt property just before filing can be challenged.
- Forgetting a tax refund. A refund you are owed is property. The wildcard may protect it, but it must be listed.
- Undervaluing a home or car. Values must be honest and supported. Low guesses draw objections.
- Cashing out a 401(k) to pay debts. Retirement funds are usually protected. Once withdrawn and spent, they are gone.
Related services
Exemptions matter most in Chapter 7 bankruptcy in Beverly Hills, where unprotected property can be sold. Start with a means test evaluation to see which chapter you can use.
More on what you keep
- California Exemptions: System 1 vs System 2
- The California Homestead Exemption and How Yours Is Figured
- The California Motor Vehicle Exemption
- The Wildcard Exemption Under CCP 703.140(b)(5)
- Retirement Accounts, 401(k)s and Pensions in Bankruptcy
- The Tools of the Trade Exemption
- Household Goods, Jewelry and Personal Property
- Wages, Tax Refunds and Cash on Filing Day
Exemption questions
Can I keep my house if I file bankruptcy in California?
Yes, many people keep their house when they file bankruptcy in California. If your equity is within the homestead exemption, it is protected. If it is more, Chapter 13 can often protect the house while you pay creditors over time.
Are my 401(k) and IRA safe in bankruptcy?
Yes, most 401(k) plans and IRAs are protected in bankruptcy. Employer plans covered by federal retirement law are generally excluded from the case entirely, and IRAs are protected under both California systems, within limits. We confirm the treatment of each account you have.
Which exemption system is better for renters?
For renters, the 703 system is usually better. It has a wildcard that can protect cash, savings and other property you would otherwise lose. We still compare both before choosing.
What happens to property that is not exempt?
In Chapter 7, the trustee can sell property that is not exempt and pay creditors from it, or let you buy it back. In Chapter 13, you keep your property and pay at least its non-exempt value through your plan. We look for ways to avoid either before you file.
Free consultation
See what you keep before you file
Call (310) 362-9071 or send the form. Bring a list of what you own and what you owe, and we will run both exemption systems for you.
Law Offices of John Asuncion9454 Wilshire Blvd., Penthouse Floor
Beverly Hills, CA 90212
(310) 362-9071
Monday to Friday, 9 a.m. to 6 p.m.