Bankruptcy dollar adjustments are required to take place every three years
The Judicial Conference of the United States has announced that certain dollar amounts and dollar limitations in the U.S. Bankruptcy Code will increase effective April 1, 2022.
The bankruptcy dollar adjustments are required to take place every three years pursuant to 11 U.S.C. §104. The new dollar amounts reflect an approximate, average 11% increase.
Here is a summary of some important bankruptcy dollar adjustments:
• Exemptions: The dollar amounts limiting exemptions that an individual debtor may elect to protect property from creditors and the bankruptcy trustee will increase under 11 U.S.C. §522. As one example, an individual may exempt up to $27,900 of an interest in real property or personal property that is used as a residence (up from $25,150). Accordingly, a married couple filing for bankruptcy may exempt up to $55,800 of equity in jointly owned real property.
• Wage Claims: The cap on priority employee claims (i.e., any claim for wages, salaries, or commissions) will increase from $13,650 to $15,150. 11 U.S.C. §507(a)(4).
• Farmers: A family farmer may file for chapter 12 with aggregate debts of less than $11,097,350 (up from $10,000,000). 11 U.S.C. §101(18).
• Chapter 13: An individual may file for chapter 13 provided that his/her noncontigent, liquidated unsecured debts are less than $465,275 and secured debts are less than $1,395,875 (up from $419,275 and $1,257,850). 11 U.S.C. §109(e).
• Preferences: The minimum amount that a trustee may attempt to recover in non-consumer preferential transfer cases will increase from $6,825 to $7,575. 11 U.S.C. §547(c)(9).
• Involuntary Filings: The minimum aggregate claims threshold for an involuntary chapter 7 or chapter 11 bankruptcy filing by creditors will increase from $16,750 to $18,600.
A summary of all bankruptcy dollar adjustments may be found in the Federal Register published February 4, 2022. Do you qualify to file bankruptcy? Contact the team at the Utah Bankruptcy Guy to set up a consultation today!