We're pleased to inform you that New York bankruptcy exemptions have just undergone their biggest change in years. On December 23, 2010 New York State Senate bill S.7034A and Assembly bill A. 8735A were signed into law by Governor Paterson. The new law became effective on January 22, 2011.

Here are some of the most significant changes, as shown below:

• The homestead exemption has increased from $50,000 to $150,000 for the counties of Kings, New York, Queens, Bronx, Richmond, Nassau, Suffolk, Rockland, Westchester, and Putnam.  A married couple can now exempt up to $300,000 in equity as opposed to $100,000 before.

• Debtors are now able to choose whether to use the New York exemptions or the federal exemptions. This is key for debtors who do not use the entire homestead exemption. The "wildcard" exemption in § 522(d)(5) of the Bankruptcy Code allows Debtors to exempt a significant amount of cash-$1,150 plus up to $10,825 of any unused amount of the homestead exemption.  The prior amount of cash exemptions was $2,500 per filer.

• The motor vehicle exemption increases from $2,400 to $4,000 for each filer.

• The New York Banking Department will publish cost of living adjustments to exemption amounts every three years commencing April 1, 2012.


A married couple filing jointly for bankruptcy can double the amount of the exemptions.

We are now finding that many of those who previously could not file Chapter 7 are now eligible either because they can now protect all of the equity in their home or because they can now use the federal exemptions to protect all of their cash, cars, and tax refunds.  It may be worth a second look!!! The new exemptions also mean that those filing a Chapter 13 can now offer less to their unsecured creditors.