Select Page

Virginia Bankruptcy Exemptions - Lawyer Richmond, Virginia Beach, Newport Newsby John G. Merna


The Big Exemptions – Your House & Tax Refunds

When it comes to Virginia Bankruptcy Exemptions you could spend all day talking about protecting a lot of little thing.  I have already talked about vehicle, so that leaves just two other things people are concerned about: their home and their tax refund.  A person’s home is usually their greatest lifetime asset while their tax refund is generally their largest annual asset.  So let’s talk about how they can be protected in bankruptcy.

Virginia Bankruptcy Exemptions – Protecting Your Home

Protecting your house is complicated in many ways.  I will do my best to simplify it.  What you are protecting in a house is any equity.  Equity is the difference between what a house is worth and what is owed.  Example1: $200,000 house with a $150,000 mortgage = $50,000 of equity that needs to be protected.  Example2: $300,000 house with a $350,000 mortgage on it = no equity and nothing to protect.  You get the idea.

No equity = nothing to protect.

Next level of analysis is what protection are you using?  If it is the homestead you have only $5,000 if you are under age 65.  What happens if you have more than $5,000.  You could be okay if… are married and your wife is on the deed with you.

Tenants-by-Entirety Protection In Virginia

In many state the law has provided an added level of protection for married couples who hold the deed of their house as “tenants-by-entirety”.  If you are married and the deed to your house is in both your wife’s and your name then you have an added level of protection.  Whether you have complete protection depends on whether you have any joint unsecured debt with your spouse.  If not then all the equity in the house is protected from your unsecured creditors.  If you do have some joint debt with your wife it becomes more complicated.  You will definitely need an attorney in that situation.

Virginia Bankruptcy Exemptions – Protecting Your Tax Refunds

Protecting your tax refund on the surface seems straight forward.  The protect comes from the homestead deed we talked about in Part 2.  Remember that $5,000?  A few issues, you have to begin protecting your tax refund the year prior to receiving it.  The way the bankruptcy court looks at is you have to start protecting an ever increasing pro-rated portion as you get closer to the date you receive it.   And just a word of warning, don’t pay any relatives back with your tax refund.  The trustee may be able to get that money back from your relative.

Well, that is the short version of the rules.  They are more complicated and there are some twists.  Just make sure you use an attorney and tell them everything.  I am available if you have a protection issue you want to discuss.


On a personal note, I appreciate all the thanks from our blog readers and clients about the various topics I write about. To link to this stream of postings just “friend” us on Google+.  I would also appreciate if you would Google +1 this page at the top and our bankruptcy page to help others find this information. Stay tuned and God bless.


TO READ PART 1  OR PART 2 – Click on each.



 The Merna Law Group, Attorneys At Law, P.C. …debt free!5 Stars! “A friendly staff and outstanding attorney who helped me through a difficult time in my life. Thanks to everyone at the Merna Law Group who helped me move on to and new chapter in my life debt free!” Reviewed by M.F. of Norfolk on Mar 8 . 
 The Merna Law Group, Attorneys At Law, P.C. …overall experience was outstanding!5 Stars! “My husband and I were very happy with The Merna Law Firm. They are well organized, time manageable, and friendly. I was even able to bring my children with me if I needed to. In court, they stayed right there beside us and answered all questions we had. Our overall experience was outstanding and I am glad we were represented by the Merna Law Group.” Reviewed by A.M. of Suffolk on Mar 5 . 
 The Merna Law Group, Attorneys At Law, P.C. …kind and friendly from the start!5 Stars! “Everyone there was kind and friendly from the start and helped us with everything in a timely manner. They were never rude no matter how much we called or asked questions.” Reviewed by B.P. of Virginia Beach on Feb 20 . 
 The Merna Law Group, Attorneys At Law, P.C. …very helpful and friendly!5 Stars! “Everyone at the office was very helpful and friendly. The attorney answered all of our questions and helped us through the entire process. He was also very helpful answering concerns that we had after the process was completed/over. Highly recommended!” Reviewed by M.E. of Virginia Beach on Mar 11 . 
 The Merna Law Group, Attorneys At Law, P.C. Didn’t have to worry about anything!5 Stars! “Just keep providing the type of service you do. You business values are based off reliability and service. Today’s Law Offices just don’t offer that kind of experience. Didn’t have to worry about anything!!! Just being able to go on with my normal life and know that all my issues are well taken care of is a relief in itself.” Reviewed by A.P. of Virginia Beach on Mar 4 .