Keeping Jewelry When You File Bankruptcy In Colorado
“How much jewelry can I keep when I file bankruptcy?” One of the biggest concerns people have when they file bankruptcy is that they’ll lose all of their property. Usually they’re not concerned with things like their televisions or computers or even their cars. They’re worried about their wedding rings.
Fortunately the Bankruptcy Code allows most people to keep their jewelry including their wedding and engagement rings. Within the Bankruptcy Code are rules called exemptions which protect personal property up to a certain amount. Each state gets to decide whether they will use the federal exemptions or their own, state exemptions. Colorado uses state exemptions, most of which can be found at Colorado Revised Statute Section 13-54-102. Included in 13-54-102 is an exemption for jewelry, which states that, “watches, jewelry, and articles of adornment of the debtor and each dependent to the extent of two thousand dollars in value” are “exempt from levy and sale under writ of attachment or writ of execution.” That exemption allows you to keep jewelry up to $2,500.00 in value.
There is not an exemption that specifically protects wedding or engagement rings. Filers have to use the jewelry exemption to protect those rings.
The value we use to see if your jewelry comes within that amount is its liquidation value, which is basically what you would get for it if you sold it. We don’t use what it would cost to replace. You can find the liquidation value at a few places. You can try online, in jewelry stores, and even pawn shops. We also recommend clients use the auctioneer that the Colorado trustees use as well. That’s probably the safest way to get a value in Colorado. As long as the value of your jewelry is below $2,500, you don’t have to worry about the bankruptcy trustee asking you to turn it over so he can sell it and give the proceeds to your creditors.
If your jewelry is over the $2,500 amount you have a couple of options. You can sell it to a third party (preferably not a family member) for its market value and use the money in an appropriate way. Or you can “buy” it back from the trustee for the amount over the $2,500 exemption. That usually involves some negotiation to agree upon a value and might involve an appraiser looking at your jewelry.
If the value of jewelry is significantly over the exemption amount, we may talk about Chapter 13 bankruptcy. Chapter 13 bankruptcy will protect that jewelry, but the filer will need to pay the value of any jewelry over the exemption amount to their creditors in a Chapter 13 bankruptcy repayment plan.
Talk To A Denver, Colorado Bankruptcy Attorney About Your Assets When You File Bankruptcy In Colorado
Our job is to make sure that you keep as much of your jewelry as possible. We’ll ask you provide us with a list of everything own and let you know whether it’s protected or whether we need to do some pre-filing planning.
You can get any questions you have about the bankruptcy process in Colorado answered during a free, no-obligation consultation with an experienced attorney. Use our online scheduling system or call 303.331.3403 to set up a time that’s convenient for you.
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