Bankruptcy is a legal process that offers individuals and businesses a chance to start fresh financially. In 2023, West Virginia (WV) enacted House Bill 2221, bringing significant changes to the state’s bankruptcy laws. Southern WV residents considering or filing for bankruptcy should understand how these changes may impact them. This blog post will explore the key changes to West Virginia bankruptcy law under HB 2221, with a focus on the updates to the WV bankruptcy exemptions and how they may affect individuals and families in Southern WV.
Key Changes to West Virginia Bankruptcy Law under HB 2221
House Bill 2221 brought several changes to the state’s bankruptcy code, specifically WV Code § 38-10-4, which governs WV bankruptcy exemptions. These updates to the law may impact Southern WV residents seeking financial relief through bankruptcy because the exemptions allowed under the law determine what property debtors can keep in bankruptcy and what they must surrender to their creditors.
A Southern WV bankruptcy lawyer can help you evaluate your specific financial situation and ensure that you keep all of the assets and property that you are entitled to under the amendments to the law.
Updates to WV Bankruptcy Exemptions
For individuals considering or filing for bankruptcy, the updated bankruptcy exemptions under HB 2221 could make a difference in the amount of assets and property you can retain. Under the new law, individuals may protect up to $16,000 worth of personal property, including household goods, clothing, and other personal items.
Amendments to WV Code § 38-10-4 increase the amount a person filing for bankruptcy can retain in personal property from $400 per item to $800, with the total exemption for this type of property increasing from $8,000 to $16,000. The law also doubles the amount a person can exempt for personal property like professional books and trade tools used in their work, raising the limit from $1,500 to $3,000. Debtors will also now be able to retain up to $2,000 in personal, family, or household jewelry, an increase over the previous limit of $1,000. These exemptions can be especially beneficial for Southern WV residents who do not have significant assets but wish to protect their personal and professional belongings.
Additionally, recipients of payments related to personal injury claims can protect more of that compensation under the new law. Payments for a personal injury of the debtor or their dependents are exempt up to $50,000, a significant increase from the previous limit of $15,000.
West Virginia Bankruptcy Exemptions for Life Insurance and Annuities under HB 2221
Another change introduced by House Bill 2221 is an update to the exemptions for life insurance and annuities (except for credit life insurance). These changes offer greater protection for individuals filing for bankruptcy in WV who have interests in certain life insurance policies and annuities. With these exemptions in place, debtors who file for bankruptcy may be able to keep their life insurance policies and annuity contracts, even if they have to liquidate other assets to repay their debts.
It is important to note, however, that the specific terms and conditions of life insurance policies and annuity contracts may vary, and individuals should consult with a Southern WV bankruptcy lawyer to fully understand their options and how the new law may impact their specific situation.
Your Southern WV Bankruptcy Lawyer Can Help
These changes to bankruptcy law under House Bill 2221 may significantly impact individuals considering or filing for bankruptcy in WV. The updated exemptions, in particular, may provide much-needed relief by allowing debtors to protect more of their personal property and assets in bankruptcy. Residents of the state may find it beneficial to seek the guidance of an experienced bankruptcy lawyer to navigate these changes and better understand their options. Southern WV bankruptcy lawyer Jason Harwood tracks the changes made to West Virginia bankruptcy laws and exemptions, allowing him to better serve and protect his clients. If you are facing bankruptcy and need legal help, contact Jason at Harwood Legal, PLLC by calling 304-752-5015 or completing this online contact form.