How much Cash Can I Keep if I File Bankruptcy in NYC?

If you are considering filing for Bankruptcy in New York you may be able to keep some or all of the cash you currently have.  New York State and Federal Bankruptcy exemptions allow debtors to retain certain amounts of cash when filing for bankruptcy. When you file for bankruptcy it is the job of the bankruptcy trustee to liquidate your assets in order to repay a portion of your outstanding debt to your creditors.  However, in order to ensure you will be able to rebuild your life after bankruptcy much of your property- including some of the cash you have on hand- can be exempted from liquidation under the US Bankruptcy Code.

Both New York State, and Federal Exemption programs exist.  Bankruptcy filers can choose which of the two exemption programs to use, but they cannot mix and match elements from both.  Depending what assets you are trying to protect and your overall debt situation your attorney may advise the Federal or New York State exemption program.  If you are using the New York State exemptions the amount of cash you can exempt is $2,500 unless you own a home and plan on using the New York Homestead exemption.  If you are using the Homestead exemption which can protect up to $150,000 in home equity in New York City then you may only exempt $2,500 in cash.  On the other hand, under Federal Bankruptcy exemptions you may exempt up to $12,750 in assets including cash providing you are not claiming a Federal Homestead exemption.  The Federal exemptions allow you to protect more cash, but will only protect up to $22,975 in home equity. Cash can be considered to be bank accounts, tax returns, alimony and certain other benefits as well.

How much cash you keep will largely depend on whether or not you own a home, and what other assets you are hoping to protect.  A qualified attorney in New York will be able to advise you towards the best overall bankruptcy discharge or repayment.  This may include protecting as much cash as possible, protecting the equity in your home, or both.  Every situation is different, so consulting a qualified bankruptcy attorney about the cash you have on hand is the most important first step.

If you are considering bankruptcy, but are worried about losing the cash you have in your accounts please contact the Law offices of William Waldner.  Most of our clients are pleasantly surprised to learn how much they will actually be able to keep and how much overall protection for their other assets is available through bankruptcy as well.   As of 11/25/2013 we have a 100% Chapter 7 Bankruptcy discharge record in New York City while providing affordable bankruptcy assistance for all New Yorkers.


This article is intended for educational purposes only.  By reading this article no attorney-client relationship has been created.