In California, individuals filing for bankruptcy can choose between two sets of exemptions: CCP 704, which applies both inside and outside of bankruptcy, and CCP 703.140, which is only available in bankruptcy. When filing for bankruptcy, individuals must choose one of these exemption sets. Exemptions are often referred to as necessities of life and are discussed elsewhere in my blog in more detail.
For those without real property, California’s 703 bankruptcy exemptions are advantageous because they include a “wild card” or “grubstake” exemption that currently allows for the protection of up to $33,650 (as of January 2023) in any type of asset, including cash.
However, until recently the law stated that a married person filing for bankruptcy without their spouse cannot select the 703.140 exemptions without their spouse’s consent. This requirement was originally intended to ensure that a spouse filing for bankruptcy alone would claim the house exempt under 704.
The issue arises when the non-filing spouse cannot be located or chooses not to consent to the other spouse selecting the 703 exemptions, including the wild card exemption. To address this problem, recent amendments have eliminated the need for an estranged spouse’s consent to the election of 703 exemptions, provided that the couple does not jointly own a house that can be claimed exempt under the 704 exemptions, which offers a much larger homestead exemption. This change is found in CCP 703.140(a)(2)(B).
At the Law Office of Michael Primus, we have helped hundreds of clients get out of debt, stop wage garnishments, and start fresh through bankruptcy. If you live in Contra Costa County and have debt problems, contact us for a free consultation. Offices in Walnut Creek, Antioch and Hercules.