Exempt Property

THIS FLYER IS MEANT TO PROVIDE AN INTRODUCTION AND BASIC OVERVIEW OF UTAH’S EXEMPTION LAWS.  THIS FLYER DOES NOT TAKE THE PLACE OF CONSULTING A LAWYER ABOUT YOUR PARTICULAR SITUATION.  THIS FLYER DOES NOT CONSTITUTE LEGAL ADVICE.

• WHAT DOES “EXEMPT PROPERTY” MEAN?  Property that is protected and cannot be taken by your creditors to satisfy a judgment for debt.  (Utah Code § 78-23-2).
• WHO MAY CLAIM AN EXEMPTION?  You.  If you fail to do so, your spouse, your dependents, or anyone else whom you authorize may claim an exemption on your behalf.  (Utah Code § 78-23-12).
• CAN AN EXEMPTION BE WAIVED?  Depends on the timing.  You cannot waive an exemption in favor of an unsecured creditor before your property has been seized, attached, or garnished.  (Utah Code § 78-23-11).
• WHAT PROPERTY QUALIFIES AS “EXEMPT” UNDER UTAH LAW?  The following is a list of property that is generally exempt from seizure or collection under Utah law (Utah Code §§ 78-23-5, 78-23-8, 78-23-9):
• Burial plot for you or anyone in your family;
• Health aids that are reasonably necessary;
• Public Benefits such as General Assistance, Social Security, Disability, Unemployment, Worker’s Compensation, Medical and Veterans;
• Alimony, Child Support & QDROS or separate maintenance;
• One clothes washer & dryer, refrigerator & freezer, stove & microwave, and sewing machine;
• All Carpets in use at your house;
• Food and other provisions sufficient for 12 months for you and your family;
• Clothing that is reasonably necessary (no mink coats);
• Beds and bedding for you and your immediate family;
• Artwork depicting or produced by you or immediate family (unless such artwork is held as part of a trade or business);
• Insurance proceeds, judgment, or settlement that are compensatory for bodily injury or wrongful death to you or to someone for whom you are or were a dependent;
• Cash value of Life insurance policy;
• Pensions, IRA, 401(K) plans and retirement plans.
• Sofas, chairs, and related furnishings, up to a total value of $500;
• Dining and kitchen tables and chairs reasonably necessary for one household, up to $500 per debtor;
• Animals, books, and musical instruments, up to a total value of $500;
• Heirlooms or other items of “particular sentimental value” up to a total value of $500;
• Implements, professional books, or tools of your trade, all having a total value not exceeding $3,500;
• Motor vehicle (1) not exceeding $2,500 in value, used primarily for daily transportation, and not used for recreational purposes;
• Cars with equity up to $2,500
• Portion of unpaid but earned wages
• $10,000 in value of jointly owned real property that is not primary personal residence
• House or primary residence with equity up to $20,000 per debtor
• IS MY EXEMPT MONEY STILL EXEMPT IF I PLACE IT IN A BANK ACCOUNT?  As a general rule, money that qualifies as exempt remains exempt so long as it is traceable in your bank account.  A court will consider the first money in and first money out, or last money in and last money out in determining which money in the account is exempt.  If your money that would otherwise be exempt is mixed with other money in your account, it may be difficult to trace and may lose its exempt status.
• ARE THERE EXCEPTIONS THAT ALLOW EXEMPT PROPERTY TO BE ATTACHED OR GARNISHED?  Yes; a creditor may attach or garnish exempt property to enforce (i) alimony, (ii) spousal support, (iii) child support, (iv) wages, (v) state or local taxes, (vi) money owed for the purchase of a specific property item (e.g., money owed to a dealer for the purchase of a car, and the car is not exempt from the dealer repossessing it), (vii) labor or materials used to make, repair, improve, preserve, store, or transport a specific property item (e.g., if you have your car fixed, the mechanic can attach the car), (viii) statutory liens or security interests in a specific property item (e.g., if you used your car as collateral for a loan, the lender will most likely have a security interest in the car and may repossess it if you default on the loan), or (ix) money owed as a special assessment for public improvements benefiting a specific piece of property (e.g., money owed for the city putting in a curb and sidewalk).  (Utah Code §§ 78-23-10, 78-23-11).
• WHAT CAN I DO IF A CREDITOR UNLAWFULLY TRIES TO OR DOES ATTACH OR GARNISH MY EXEMPT PROPERTY?  You or your spouse (or a dependent) may ask a court to stop the creditor from taking the exempt property.  You may also be entitled to receive damages.  If you prevail, the court may award costs and reasonable attorney’s fees to you.
• MAY I CLAIM EXEMPT PROPERTY IF I FILE BANKRUPTCY?  You may not exempt property in your bankruptcy case except for those exemptions expressly permitted under Utah law.  (Utah Code § 78-23-15)