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Florida Exemptions Update – Which Chapter Am I Eligible For?

On April 1, 2010, Debt limits for Chapter 13 increase to $360,475 of unsecured debt and $1,081,400 of secured debt. This change increases the debt ceiling in effect prior to the change of about 7%. Congress limited the amount of debt owed by the debtor in a Chapter 13 case but adjustments to the debt limits are scheduled to occur every three years on the first day of April in the year of adjustment beginning April 1, 1998. Bankruptcy Code section §109(e) prohibits use of Chapter 13 by individuals with debts that exceed specified limits. The adjustments are required by §104(a) of the code and an adjustment is due this year.

The dollar amounts are rounded to the nearest $25 increment and apply to a number of different dollar limits impacting Chapter 7, 11, 12 and 13 cases. The adjustment of various dollar amounts specified in the bankruptcy code is intended by statute to reflect the change in the Consumer Price Index for All Urban Consumers, published by the Department of Labor, for the most recent 3-year period ending on December 31 of the prior year. These limits are per person filing, so a couple filing together would be allowed double these amounts and still remain eligible for Chapter 13 relief. The change, therefore makes it a little easier for people with large debt loads to file under this chapter where it is more of a streamlined process than would be under Chapter 11.

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