30 May South Carolina Exemptions Updated (and Increased!)
On the better-late-than-never front, the South Carolina legislature has amended the South Carolina exemption statute to significantly increase the amount of personal property that is exempt from creditors. Since South Carolina has opted out of the federal exemption scheme contained in the bankruptcy code, this change in South Carolina law has implications for any individual filing bankruptcy in South Carolina after May 22, 2008. The most significant changes in the new statute increase the exemption for a vehicle from $1,200 to $5,000, for household goods and clothing from $2,500 to $4,000, and for cash in lieu of homestead exemption from $1,000 to $5,000. In addition, the statute adds two new categories: a $5,000 wildcard exemption, and an exemption for the earned income credit on federal taxes.
The South Carolina legislature amended the homestead exemption two years ago, which was the first substantive change in the statute since 1979. State legislators took up the issue of personal property this year, passed the bill, and then had to override a gubernatorial veto to pass the measure into law.
The increases are large, but the new law was long overdue. The best evidence of that was the $1,200 exemption available in a vehicle. In 1979 (I am reliably informed) $1,200 was sufficient to purchase basic transportation, but that is no longer true. A colleague refers to the new exemption law as the 1998 Camry Act, because that’s about what $5,000 will buy today. Today in South Carolina, we don’t have to worry that a debtor will lose that 1998 Camry to his creditors, or to a bankruptcy trustee. That is especially significant in a state that lacks any real public transportation. In South Carolina, if you are going to work, you need a car. And that’s just one example. Debtors in South Carolina will be better able to make a fresh start, without being left destitute and unable to work.
If you live in South Carolina, and you have hesitated to file a bankruptcy because of concern over losing a car or some other property that was not protected under the prior law, now would be a good time to go and see an attorney about how the change in the law changes your situation.
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