TEXAS BANKRUPTCY LAW

Texas Bankruptcy: Attorneys, Statistics, Exemptions and Courts.

Texas Bankruptcy Statistics: In 2009, over 55,000 bankruptcies were filed in the state of Texas. Business bankruptcies accounted for 4,567 and personal bankruptcies accounted for 50,868 or more than 91% of Texas’ bankruptcies.

Texas State Bankruptcy Exemptions:

Real Property

The home (“homestead”) is exempt in bankruptcy when it meets the following requirements:
(1) Located in a town, city or village and is 10 acres or less.
(2) Located outside of town, village or city and is 100 acres or less for a single person, and 200 acres or less for a family.

Note: If the home is sold, the proceeds from the sale continue to be exempt for six month after the sale.

Burial Plots are also exempt in a Texas bankruptcy.

Personal Property

Personal property valued at $30,000 for a single person and $60,000 for a family is exempt in bankruptcy.

The follow items of personal property are excluded from the exemption value (they are excluded, but their value is not added to the $30,000 or the $60,000).

1. Health Aids
2. Health savings accounts

The following items are included in the $30,000 or $60,000.

1. Furnishings and family heirlooms
2. Food and clothing
3. Jewelry – only to the extent that the value of the jewelry does not exceed 25% of the total value or $7500 for a single person and $15,000 for a family
4. Firearms - two
5. Sporting equipment - includes bicycle
6. Vehicles - One car for each member of the family who either has a license or relies on someone else to drive him or her. Also boats used in a professional trade and vehicles used for farming.
7. Animals – unlimited number of pets: however, at most 2 horses, mules or donkeys; 12 heads of cattle; 60 heads of other livestock and 120 fowl.

Insurance

The following categories of insurance benefits are exempt in a Texas bankruptcy.

1. Church benefits plans and fraternal benefit societies.
2. Life, health or accident insurance.
3. Annuity contracts – not limited to benefits, proceeds, monies and cash value
4. Group insurance and employee benefits of Texas public school and Texas state colleges/university employees

Pensions

The following individuals’ pensions (and the benefits received by their survivors) are exempt in bankruptcy.

1. Police officers, law enforcement officers and other employees
2. Firefighters
3. Elected officials, and municipal and state employees
4. Government mental health workers
5. Emergency medical personnel
6. Teachers
7. Judges

The following types of pension are exempt in Bankruptcy.

1. ERISA government and church benefits (ex: IRA or Keoghs)
2. Tax-deferred retirement accounts

Public Benefits

The following public benefits are exempt when filing bankruptcy in Texas:

1. Crime victim’s right to receive compensation
2. Public assistance
3. Medical Assistance
4. Unemployment compensation
5. Workers’ compensation

Tools of the trade *Not a separate exemption.

Motor vehicles, tools, books and office furniture used in trade are part of the personal property exemption.

Wages

Earned, but unpaid wages are exempt in bankruptcy. Earned, but unpaid commissions are exempt, but not entirely. The exemption is limited to 25% of the personal property exemption or $7500 for a single person and $15,000 for a family.

Miscellaneous Texas Bankruptcy Exemptions

Property of business where you are a partner is exempt in bankruptcy. Also, liquor licenses and permits are exempt.

Prepaid tuition plans and savings plan trusts for higher education are exempt in bankruptcy.

Child support and alimony are also exempt in bankruptcy.

Federal Bankruptcy Exemptions: Yes

Texas Bankruptcy Courts:

United States Bankruptcy Court, Eastern District of Texas

United States Bankruptcy Court, Northern District of Texas

United States Bankruptcy Court, Southern District of Texas

United States Bankruptcy Court, Western District of Texas