What is exempt from bankruptcy in New Jersey?

Debtors filing Chapter 7 bankruptcy in the state of New Jersey are afforded a limited number of protections under exemptions lists provided by either the state of New Jersey or the federal government. Currently, the state of New Jersey does not preclude debtors from electing to claim exemptions under the federal exemptions list, as forty (40) other states do. Assuming a debtor meets the residency requirements as laid out by both the state of New Jersey, as well as the federal government, most notably in the Bankruptcy Abuse Prevention and Consumer Protection Act, the following state of New Jersey exemptions are available:

• No homestead exemption provided by statute in state of New Jersey exemption list

• Most insurance benefits exempted, including life insurance benefits, health policy benefits, fraternal benefit society benefits, and annuity contracts limited in benefit of up to $500 monthly

• Most pension benefits from government or public service entities, as well as any ERISA applicable benefits and certain trust benefits

• Public benefits, including workers compensation, certain disability benefits, and unemployment compensation, are exempt under New Jersey Chapter 7 exemption statutes

• No wildcard exemption allowed in state of New Jersey

• Wages are exempt up to ninety (90) percent, if individual earns less than $7,500, but if higher, exempt amount determined at court’s discretion

For debtors with viable residency in the state of New Jersey, consulting with a bankruptcy lawyer is essential. Not only can debtors elect to claim exemptions from either the federal or state of New Jersey exemptions list, but also, they must make careful determinations on how their own individual assets may best be protected under each list. Furthermore, while the list of exemptions noted above for the state of New Jersey cites some of the most common exemptions, the reality is that numerous other exemptions exist, which may be applicable in your individual bankruptcy case. Consult with a bankruptcy lawyer in the state of New Jersey to learn more about your exemptions options when filing Chapter 7 today.