ILLINOIS BANKRUPTCY LAW

Illinois bankruptcy: Attorney, Statistics, Exemptions and Courts.

Illinois Bankruptcy Statistics: In 2009, in the state of Illinois, 74,244 bankruptcies were filed. Personal bankruptcies accounted for the majority at 71,778 or 96.68%, and business bankruptcies accounted for 2,466 or 3. 32%.

Illinois State Bankruptcy Exemptions:

Homestead

The home is exempt when filing for bankruptcy, whether the home is a real property such as a farm or a house, or whether it is a personal property such as a mobile or a manufactured home. The exception is limited to $15,000 for a single person and $30,000 for a married couple. In certain limited circumstances, when the debt belongs exclusively to one of the spouses, and the home is owned as a tenancy by the entirety, the home may be wholly protected in bankruptcy. Spouse or children of the deceased homeowner may claim this exemption.

The proceeds from the sale of the home continue to be exempt for one year after the sale occurred. Also if the home is destroyed, the payout from the insurance is exempt according to the same limitations that would have been placed on the home.

Personal Property

The following items are exempt in their entirety:

1. Deposits in prepaid tuition trust fund
2. Pre-need burial expenses and trust funds
3. Clothing
4. Family pictures
5. Bible
6. Schoolbooks
7. Health Aids
8. Damages recovered in wrongful death claim

The following exemptions are limited to a statutorily specified amount:

1. Motor vehicle is exempt up to $2,4000
2. Damages recovered in personal injury claim are exempt up to $15,000

Insurance

When filing bankruptcy in Illinois, the following insurance policies are exempt:

1. Life insurance proceeds
   • If the beneficiary is the child, spouse, parent or other dependent of the insured – the entire policy is exempt
   • If the beneficiary is a dependent of the debtor – whatever is necessary for support is exempt
2. Fraternal benefit society benefits are entirely exempt
3. Disability or health benefits are entirely exempt

Pensions

Federal bankruptcy exemptions apply in Illinois to pensions, even though in general federal exemptions do not apply. Also, IRAs and ERISA-qualified pensions are exempt.

The following individuals’ pensions are entirely exempt:

1. General assembly members
2. Police officers
3. Firefighters & disable firefighters
4. Municipal employees
5. County employees
6. Civil service employees
7. Park employees
8. Sanitation district employees
9. State employees
10. State university employees
11. Teachers
12. Judges
13. House of correction employees
14. Public library employees

Public Benefits

The following benefits are exempt entirely:

1. Disability, age or blind assistance
2. Public assistance
3. Social Security
4. Unemployment compensation
5. Veterans’ benefits
6. Crime victim reparation
7. Restitution benefits for the relocation of Aleuts and Japanese Americans during WWII
8. Workers' compensation
9. Worker's occupational disease compensation

Miscellaneous

Child support and alimony payments are exempt in their entirety when filing for bankruptcy in Illinois.

Business properties, when the debtor is a partner in the business, are exempt.

Tools of the Trade

In an Illinois bankruptcy proceeding, books, implements and tools are exempt for up to $15,000.

Wages

Wages earned, but not paid, are exempt at either 85% of the income or 45 times the state or federal minimum wage, whichever is higher. A judge had discretion to allow for a higher exemption for low income debtors.

Wildcard

Any personal property may be exempt for an additional $4000.

Federal Bankruptcy Exemptions: Yes

Illinois Bankruptcy Courts:

United States Bankruptcy Court in Eastern District of Michigan

United States Bankruptcy Court in the Central District of Illinois has jurisdiction over the following counties: Adams, Brown, Bureau, Cass, Champaign, Christian, Coles, De Witt, Douglas, Edgar, Ford, Fulton, Greene, Hancock, Henderson, Henry, Iroquois, Kankakee, Knox, Livingston, Logan, Macon, Macoupin, Marshall, Mason, McDonough, Mclean, Menard, Mercer, Montgomery, Morgan, Moultrie, Peoria, Piatt, Pike, Putnam, Rock Island, Sangamon, Schuyler, Scott, Shelby, Stark, Tazewell, Vermilion, Warren, Woodford.

United States Bankruptcy Court in the Northern District of Illinois has jurisdiction over the following counties: Boone, Carroll, Cook, Dekalb, Du Page, Grundy, Jo Daviess, Kane, Kendall, Lake, La Salle, Lee, McHenry, Ogle, Stephenson, Whiteside, Will, Winnebago.

United States Bankruptcy Court in the Southern District of Illinois has jurisdiction over the following counties: Alexander, Bond, Calhoun, Clark, Clay, Clinton, Crawford, Cumberland, Edwards, Effingham, Fayette, Franklin, Gallatin, Hamilton, Hardin, Jackson, Jasper, Jefferson, Jersey, Johnson, Lawrence, Madison, Marion, Massac, Monroe, Perry, Pope, Pulaski, Randolph, Richland, St. Claire, Saline, Union, Wabash, Washington, Wayne, White, Williamson.