Peru, IN asked in Bankruptcy for Indiana

Q: Is unemployment income exempt in a chapter 7 bankruptcy in Indiana?

I was told that the stimulus payments were exempt and could be kept, but will the additional $300 in unemployment income be safe as well? For example, if I receive $3,000 in unemployment income, am I allowed to have that in the bank account when I file? We are filing after we receive our tax refund. We spent some of our stimulus. Are we allowed to have the full amount of the stimulus payment ($2,400) plus the unemployment ($3,000) in the bank account at the time of filing? Could the tax refund ($3,500) “replace” part of the stimulus payment that we have spent and allow the full $5,400? Thanks!

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1 Lawyer Answer
Cristina M. Lipan
Cristina M. Lipan
  • Bankruptcy Lawyer
  • Wantagh, NY

A: The tax refund is not exempt on it's own, but there's a federal wildcard exemption of $11,000 you may be able to use, depending on your other assets. You need to speak to an attorney to review all your financial details and advise you about what will be exempt.

Timothy Denison agrees with this answer

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