Cash in bank account and Wildcard exemptions ..

[Doghouse]

During a conversation with one of my init consult attorneys, I mentioned that not only was I expecting a large refund next year but if I stopped paying all CC, personal loan and mortgage debts I'd have substantial amount of money in the bank, even after paying attorney fees. Attorney said, no problem you can use the wildcard exemption to exempt the amounts.

So, if hypothetically, I can save $10,000 in my bank account by Feb and expect an $8,000 tax refund when I file taxes next April '08, what's wrong with keeping all that if I can use the California Wildcard exemption which allows $21,825?

Note, I don't plan on filing till next year Jan or Feb end but getting my ducks in a row. And I am aware of suggestions to do everything from dental, medical, vision visits to buying new car tires, car work, etc and more to use up the money and keep the bank acct to less than 1,000. Just wanted to know why I can't have substantial money in the bank if I can exempt it? Does it also have to do with an unfavorable perception to the trustee that I do actually have some money that can cover some debts?

I will soon be seeing the attorney I am retaining and want to be more informed as I do my pre-bankruptcy planning.

[ready2puke]

Well I guess its ok if you live in a cardboard box. Dont you have anything in your life that needs some of those exemptions.? Car? What kind of car do you have? More than coverend furniture, tv, ? You really may need some of that to cover those things.

[Doghouse]

Yes, I do have a car but that should be covered by the $3,300 motor vehicle exemption. And I do plan on surrendering my house which is over 150K negative equity. Household goods, furnishings, tv, kitchen appliances etc .. aren't those covered by exemptions for those items? And no, I do not own stocks, bonds, any securities, no profit sharing, no bonuses coming etc. Own no real estate other than the house. I do have a retirement fund that I have not contributed to for a long time but is exempt too.

[ready2puke]

Retirement is covered but where did you get 3,300 for the car? I have to say I am alittle confused about the exemptions but I thought the 21k was inclusive. There are two different systems to exempt things and both are under 3,300. Here is the link for you. I dont know if you've seen it before but here it is just in case you havent.

http://www.californiabankruptcy.info/exemptions.html

[Doghouse]

R2P, this was the link I was looking at for California exemptions under plan 2. I think it's more current than the one you have.

http://www.naldp.org/download/exemptions/California%20EXEMPTIONS.pdf

[ready2puke]

I like yours way way better, thanks..but why is the one I was looking at coming up in a Google search? Where did you get yours. Yours is alot more money and easier to understand...I dont get it?
BTW thanks alot for that

[ready2puke]

I have another question on this. System 1 it has IRA's retirement, Keo's etc. but there is nothing for Retirement in system 2? So if someone were to pick 2 they can take your retirement?

[albacore44]

I like yours way way better, thanks..but why is the one I was looking at coming up in a Google search? Where did you get yours. Yours is alot more money and easier to understand...I dont get it?
BTW thanks alot for that

Yes, that is a much clearer picture, however i'm concerned about conflicting information. if you notice in system 2 the wild card is doubled in a joint filing. this is the 1st time I have heard of this. If it's true, this really puts me at ease since I was going to have to try and stuff a whole bunch into it at $21k it was x 1 . since it is doubled, all my property will easily fit into it since I have no equity in my house .

[Tbornetun]

In California System 2 exemptions... "Married couples may not double any exemptions (se In re Talmadge, 822 F.2d 1120 (9th Cir. 1987);
In re Baldwin, 70 B.R. 612 (9th Cir. B.A.P. 1987)"

System 2 does not allow doubling.

[albacore44]

In California System 2 exemptions... "Married couples may not double any exemptions (se In re Talmadge, 822 F.2d 1120 (9th Cir. 1987);
In re Baldwin, 70 B.R. 612 (9th Cir. B.A.P. 1987)"

System 2 does not allow doubling.

I see those cases were settled in 1987, but this exemption list was updated in 10/2007.if it's incorrect, why would NALDP have it posted for their members to use ??

[Tbornetun]

The case law from 1987 is what determines that the exemption cannot be doubled. The updates from 10/2007 are only changing the $$ allowed. Until there is new case law determining that the exemptions can be doubled. The 1987 ruling stands.

[albacore44]

The case law from 1987 is what determines that the exemption cannot be doubled. The updates from 10/2007 are only changing the $$ allowed. Until there is new case law determining that the exemptions can be doubled. The 1987 ruling stands.

Then ther must be a lot of people getting their petitions thrown out of court, if they are being prepared by someone using those tables.

[Tbornetun]

The table you were referencing was one of the only ones I have seen without the statement about doubling. That table does not say that you CAN double either. Updates are done on the "amounts" of the exemptions every couple years, this does not change the law on these exemptions.
I know a lot of people on this forum use the NOLO books, these books also states in the exemption section, appendix A, that you are not allowed to double.

[ready2puke]

I still dont understand why the conflict. I just googled it again and first one that pops up is the old one http://los-angeles-bankruptcy.net/ca...exemptions.htm

Very confusing if its been updated since 2007 why is the old one still coming up?
Anyone know why system one has retirement accounts and system doesnt?
Thanks

[Tbornetun]

The AMOUNTS of the exemptions were updated in 2007. Not the ruling as to if they can be doubled. The amounts of the old exemptions you will continue to find all over the internet. Not everyone updates their websites everytime a state revises their exemptions.

This link is to directly to California's court website reflecting the 4/2007 amounts:

http://www.courtinfo.ca.gov/forms/documents/exemptions.pdf

Your other question about retirement accounts...one also has a wild card exemption and the other doesn't, one also has exempt wages and the other doesn't. This is why it is important to choose the system that is right for your situation and assets.

In Minnesota, the only time we use the Minnesota exemptions is if the client has a large amount of equity in their home, otherwise we only use the federal exemptions.