$4,000 Personal Property Exemption, TBE and Homestead

A March 30, 2012 decision may provide a basis for debtors in certain circumstances to keep their homestead and claim the additional $4,000 personal property exemption provided by statute in Florida. Recall that the debtor can utilize the $4,000 exemption if the debtor is not retaining the benefit of the homestead. There has been much litigation on this issue which has been the topic of prior posts.

SomeFlorida bankruptcy attorneys have argued that a debtor who is married does not have to assert the homestead exemption because realistically the trustee cannot sell the home because the debtor’s non-filing spouse retains her homestead exemption. There is case law denying the debtor’s efforts to assert this exemption.

But consider a married debtor files bankruptcy and the home is only listed as exempt as tenancy by the entireties and there is no joint debt. Judge Briskman in the Middle District of Florida held that the debtor can utilize the $4,000 exemption.In re Kehoe2012 Bankr Lexis 1321. The court distinguished an earlier case by Judge Mark due to the joint debt issue. When there is no joint debt, each spouse is protected from creditors on property held by tenancy by the entireties.

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