October 28th, 2009 by Reed Allmand 
In the Chapter 7 bankruptcy case of Sparks, Jeanette R.; In re, debtor is allowed to keep homestead exemption despite bankruptcy trustee’s objection; but is not allowed to exempt $514 held in a mutual fund account.
The details of the bankruptcy case:
“The 55-year-old, unemployed Chapter 7 debtor owned an interest in her home, which she claimed as exempt pursuant to Section 522(d)(1), and an Edward Jones mutual fund account worth $11,714, which she claimed as exempt pursuant to Section 522(d)(5). She amended her schedules to state that the house was sold “per agreed order with lender. No longer part of estate.” The trustee objected to the debtor’s exemption in the proceeds from the sale of the house and the Edward Jones account on the basis that they were worth more than the available exemptions.”
The bankruptcy court did not agree with the bankruptcy trustee’s assertion that the debtor should not be allowed to keep the homestead exemption, noting that at the time of the debtor’s bankruptcy petition, the debtor owned her home and should be allowed the homestead exemption. The bankruptcy court also noted that the bankruptcy trustee did not have evidence of equity in the home at the time of the bankruptcy filing. Furthermore, the bankruptcy court ruled that the debtor was allowed to use her full $11,200 wildcard exemption to protect the Edward Jones mutual fund account; but that $514 of the account would remain as part of the estate.
About Reed Allmand
Allmand's vision is rooted in his own financially precarious childhood in Abilene "My father always had difficulty holding a job and supporting our family, so after my parents divorced when I was 12, my sister and I got jobs to help make ends meet," he recalls. "I remember what it felt like as a child to worry that our car would be repossessed or home foreclosed on."
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