How to Calculate a Bankruptcy Estate

More and more people are finding themselves in the position of having to calculate a bankruptcy estate these days.  The economic crisis that has the country in its grasp is making this necessary.  Anyone who does it has to understand what is part of a bankruptcy estate, what is not, and how to do it.  Here's what you need to know.

What Is A Bankruptcy Estate?

Simply put, a bankruptcy estate is the sum total of all the property that you are in possession of on the day that you file for bankruptcy.  This amount in most cases will not include any property that becomes yours after you file for bankruptcy.  Depending on your state, there may be a number of exemptions that you are eligible for as well.  For example, you may be able to take advantage of a homestead exemption to help you protect your primary residence.

How To Calculate It

To calculate your bankruptcy estate, begin by making a list of everything that you own or anything that you possess the legal right to own.  The latter category refers to properties that are yours but that you don't yet have such as earned but unpaid wages, tax refunds that you have coming, and any inheritance that is yours but that you don't actually have yet.  Next you need to estimate the value of all this property.  Any property that you own jointly may only be counted for half its value unless of course you are filing bankruptcy jointly with the other owner.  Add up the total amount minus any applicable exemptions and you have your bankruptcy estate.

A Lawyer's Assistance

You will find a lawyer's assistance invaluable as you want to make sure that you claim all possible exemptions.  This will be easy as you will probably already be enlisting the aid of a lawyer for the actual bankruptcy filing.