Using FL or Federal exemptions?

[UnderH2OMom]

Hello. I've been lurking on this board for months and this is my first post. I have learned so much and I can usually find an answer to whatever question I have just by searching the board, but I have one question I can't find an answer to.

My husband and I are filing chapter 7 in 2 weeks. We are far below the median income and I don't believe there is any chance we will be pushed into a 13.

We live in the dreaded middle district of Florida, and are filing in Tampa. We have been living in Florida for 22 months. Before that, we were in Michigan for 10 months. Before Michigan, we lived in another part of Florida for 7 years.

Our attorney said that since we were not in FL for the full 24 months prior to filing, that we will can use Federal guidelines instead. Does that mean that we use the federal exeptions instead of the Florida ones? Can a trustee object to that? I just want this to go smoothly and not raise any red flags that might cause a delay.

The Federal exemptions are much more generous than the Florida ones, so we are hoping that is the case. Thanks for any insight you may have!

[justbroke]

I'm not sure you can use Federal. The rule is that if you haven't lived in your current State (State A) for 24 months (2 years), then you go back 2 years before the time you filed. Then you use the State which you were a resident for more than 180 days back then. If that State (State B) is your current State... guess what?

My reading is that you are NOT entitled to use Federal Exemptions because Florida doesn't allow them, and your 2 year test, shows you living in Florida. The reason why I say you're stuck with Florida exemptions, is becuase you're currently a resident of Florida and your 2-year lookback has you in Florida. Florida doesn't allow residents to use the Federal Exemptions. So, you can't use the Federal Exemptions.

Had you moved to, say, Georgia (your State A is Georgia) then you could use the Federal Exemptions because Florida would be your 2-year lookback State (State B), but Florida doesn't allow non-residents to use the Florida exemptions.

Yes, the Trustee can object to your exemptions, and my personal opinion is that they would in this case since you're entitled to and required to use the Florida exemptions.

[SMinGA]

My understanding:

The state you use for your exemptions is:

1 The state you lived in for the 730 days (2 years) before filing; or
2 If you did not live in a single state in the previous 2 years you use the state where you lived the majority of the 180 day period preceding the 2 year period; or
3 If the preceding renders you ineligible for any exemptions then the debtor is allowed to choose the federal exemptions.

You fail step 1... Have not lived in a single state for 2 years.
Go to step 2... The majority of the 6 months prior to 2 years: you lived in Michigan.

Use Michigan exemptions. Though if MI allows the choice between state & federal, you may have that choice now?

The ruling is to prevent someone from moving to a state just to get their exmeptions. Used to be you only needed 6 months in a state.

[SMinGA]

Its not. She said the last 22 months were in FL. 10 months before that, MI. If you've not been in the current state for 2 years, you look at where you lived for most of the time from 2 to 2 1/2 years ago. She was in MI for all of those 6 months.

I'm not sure you can use Federal. The rule is that if you haven't lived in your current State (State A) for 24 months (2 years), then you go back 2 years before the time you filed. Then you use the State which you were a resident for more than 180 days back then. If that State (State B) is your current State... guess what?

[justbroke]

11 USC 522 (b)(3)... if the debtor's domicile has not been located at a single State for such 730-day period, the place in which the debtor's domicile was located for 180 days immediately preceding the 730-day period or for a longer portion of such 180-day period than in any other place;

Perhaps your attorney is reading this wrong or I am. It's the place you lived for 180 days preceding the 2 years.

Let's say today is 6/1/2010. So the two year lookback date is 6/1/2008 (approximately not including leap year calculations). If you live in Florida from 12/1/2007 to 6/1/2008, then the 180 days is Florida. Unless you live in two places during that 180-days and I think that's what you're saying. So Michigan would be the State because it would be 8 months of that time or the entire 6 months of the special lookback.

So yeah, I got confused. I just totally left off the 22 months in Florida.

[UnderH2OMom]

Thank you both. I think I understand. My special 6 month look back would be time we spent in Michigan. We were in Michigan the entire 6 month period, so I guess we will have to use Michigan's exeptions. I'm off to see if they are any better than Florida's which are terrible.

The attorney said that if we weren't in Florida for a full 2 years, and we weren't in Michigan for a full 2 years, that we could use the Federal guidelines. Uh-oh...I hope we picked the right attorney.

[justbroke]

The attorney said that if we weren't in Florida for a full 2 years, and we weren't in Michigan for a full 2 years, that we could use the Federal guidelines. Uh-oh...I hope we picked the right attorney.

I misread something and you will be using Michigan or Federal.

[SMinGA]

If this is the only blunder, I would say to not fire him just yet. I imagine it gets a little confusing, even for the attorneys. They KNOW their state's exemptions. When it gets into dealing with the new bankruptcy code, the residency qualifications don't come up everyday and it gets a little murky I think!

Plus keep in mind - most states are probably better than FL! Since you're close to the 24 months of residency, make sure your atty understands you do not want to stall the filing!

Thank you both. I think I understand. My special 6 month look back would be time we spent in Michigan. We were in Michigan the entire 6 month period, so I guess we will have to use Michigan's exeptions. I'm off to see if they are any better than Florida's which are terrible.

The attorney said that if we weren't in Florida for a full 2 years, and we weren't in Michigan for a full 2 years, that we could use the Federal guidelines. Uh-oh...I hope we picked the right attorney.

[UnderH2OMom]

OK....found what I was looking for. Michigan is a state that allows you to choose to use the federal exeptions if you want to. Yahoo!

[SMinGA]

Yeah! And from I recall vaguely, federal exemptions are a heck of a lot better than FL. Never had reason to research them much though, as GA does not give a choice.

OK....found what I was looking for. Michigan is a state that allows you to choose to use the federal exeptions if you want to. Yahoo!

[UnderH2OMom]