Bankruptcy exemptions allow a debtor to protect property needed to work and live after a bankruptcy proceeding. Virginia lawmakers added additional protections to existing Code of Virginia § 34-4, and effective July 2020, Virginia bankruptcy filers will be able to protect an additional $25,000 of real or personal property used as a principal residence.
For reference, the current text of the Code of Virginia § 34-4 is as follows:
Every householder shall be entitled…to hold exempt…real and personal property, or either, to be selected by the householder, including money and debts due the householder not exceeding $5,000 in value or, if the householder is 65 years of age or older, not exceeding $10,000 in value.
As of July 2020, the new Code of Virginia § 34-4 text will read:
Homestead exemption of $5,000, or $10,000 if the debtor is 65 years of age or older, in cash, and, in addition, real or personal property used as the principal residence of the householder or the householder's dependents not exceeding $25,000 in value. This exemption may not be claimed in certain cases, such as payment of spousal or child support.
You can find the Code of Virginia online on the Virginia General Assembly website. Avoid property loss by verifying all bankruptcy exemption amounts through independent research or by consulting with a local bankruptcy attorney.
Learn more about filing for bankruptcy in Virginia.
Effective date: July 2020