Did you know that the state of Missouri has a wildcard exemption that you can apply to an piece of property you want? When you file for bankruptcy, you basically dump all of your property into a bucket – your clothes, your jewelry, your vehicles, your home, etc. You walk into Court and say, “Here Court – take my bucket. Sell everything that I own. Pay my creditors with it, and then please forgive me of the rest of my debt.” Now nobody wants to take the shirt off your back or the hat off your head, so you are allowed certain exemptions for items as outlined in the Missouri statutes. When you exempt something from your bankruptcy estate, you are basically pulling that item out of your bucket, and once approved by the court, you can keep it!
Missouri has numerous exemptions for a variety items, such as $3,000 of equity in vehicles (per filer), $15,000 of equity in your home, etc. Then you get a special “wildcard” exemption that allows you to exempt $600 in equity in anything you want that doesn’t already have a specific exemption. If you qualify, you also get a $1,250 head of household exemption with an additional $350 per dependent. A family of four when both husband and wife file for bankruptcy might get $1200 in wildcards + $1250 for head of household + $700 for their two dependents, so they might get $3,150 in exemptions between the wildcard and the head of household exemptions that they can apply to anything they want.
If, for example, the husband has a gun collection that is a family heirloom, and he wants to keep that collection, he could protect the guns to the extent of the amount allowed by the law. These exemptions can help protect money left in bank accounts on the filing date that is needed to pay necessary household bills. They can help protect tax refunds received after filing that are typically considered property of the bankruptcy estate. They can protect anything that isn’t already exempted under Missouri law. Even Chiefs tickets! (I know, how could there NOT be an exemption for Chiefs tickets?????)
A lot of people believe that they will lose everything they own when they file for bankruptcy – their house, their car, their wedding rings – but that is simply not true. For a complete listing of Missouri exemptions, please see www.moga.mo.gov/STATUTES/C513.HTM.
For more information on bankruptcy, please visit www.abankruptcyfirm.com or contact your Kansas City Bankruptcy Lawyer, Betsy Lynch at 816.434.6616.