Chapter 7 & 11 Bankruptcy Lawyers - Nick Davis Law

In Texas, a community property state, most property acquired during marriage is considered jointly owned by both spouses. If one spouse files for bankruptcy, the community property may be included in the bankruptcy estate, potentially affecting the non-filing spouse’s assets. However, Texas law provides exemptions to protect certain community assets, such as a primary residence under the homestead exemption. It’s essential to understand how community property laws impact your case, especially if only one spouse is filing. Consulting with a bankruptcy attorney helps you strategize how to protect your jointly owned assets during the bankruptcy process.

No, the Texas homestead exemption applies only to personal residences, not commercial properties. Businesses filing for Chapter 11 reorganization in Texas cannot use this exemption to protect offices, retail spaces, or other commercial real estate. However, businesses can explore other exemptions or restructuring strategies to safeguard valuable commercial assets. An attorney can help you navigate Texas-specific exemptions to maximize asset protection and find alternative strategies to protect your business during bankruptcy.

In Texas, urban homestead properties are limited to 10 acres under the homestead exemption. This means you can protect your primary residence and up to 10 acres of contiguous land in urban areas from being sold to pay off creditors in Chapter 7 bankruptcy. If your property exceeds 10 acres, any excess land may be subject to liquidation by the trustee. It’s important to work with an attorney to accurately measure and define your property boundaries and understand whether all portions of your land are protected under the homestead exemption.

Unlike some states, Texas does not have a wildcard exemption under its state bankruptcy laws, but if you opt to use federal exemptions, you can take advantage of the federal wildcard exemption. This exemption allows you to protect a certain amount of any type of personal property, such as cash, vehicles, or other valuable items, that may not fall under specific state exemptions. Your attorney can help you evaluate whether it’s beneficial to use Texas exemptions or federal exemptions, depending on the assets you want to protect.

Yes, Texas bankruptcy laws fully protect most qualified retirement accounts, including 401(k)s, IRAs, and pension plans, from creditors. These accounts are generally exempt from liquidation in both Chapter 7 and Chapter 11 bankruptcy, ensuring that your retirement savings are safe. However, any funds you’ve withdrawn from these accounts before filing for bankruptcy may not be protected. It’s important to plan your finances carefully before filing to ensure you don’t unintentionally expose retirement funds to creditors.

Texas bankruptcy courts may treat oil and gas royalties differently depending on whether they are considered current income or property rights. Royalties generated from oil and gas leases are often considered part of the bankruptcy estate, which could be subject to liquidation in Chapter 7 or reorganization in Chapter 11. However, the Texas Constitution protects certain mineral rights under the homestead exemption if the land qualifies. It’s essential to disclose all royalty income and work with a bankruptcy attorney to understand how these assets will be handled during the bankruptcy process.

Yes, Texas bankruptcy laws provide specific protections for farming and ranching operations. Texas’s rural homestead exemption allows you to protect up to 100 acres of land (or 200 acres for families) in rural areas, which may include farmland. Additionally, Texas allows exemptions for tools of the trade, livestock, and farming equipment, ensuring that you can continue agricultural operations after filing for bankruptcy. If you own significant farm or ranch assets, working with an attorney is essential to maximize exemptions and protect the livelihood of your agricultural business.

Property taxes in Texas, like in most states, are generally non-dischargeable in bankruptcy, meaning you will still be responsible for paying them even after your case is closed. However, Chapter 13 and Chapter 11 bankruptcy can allow you to reorganize and pay back overdue property taxes over time, avoiding penalties and interest. Similarly, debts like child support, criminal fines, and some court fees are also non-dischargeable. Consulting with an attorney will help you understand which state-specific debts can be managed and how to handle non-dischargeable obligations in your bankruptcy plan.

Texas, like other states, prohibits fraudulent transfers before filing for bankruptcy. If you transfer property or assets with the intent to hinder, delay, or defraud creditors, the trustee can reverse the transfer and reclaim the assets for the bankruptcy estate. Texas law specifically targets transfers made within two years before filing, but the lookback period can extend up to four years under state law. If you’ve made recent asset transfers, it’s essential to consult with an attorney to review the timing and purpose of the transactions and avoid legal complications.

Family-owned businesses in Texas filing for Chapter 11 bankruptcy can benefit from streamlined procedures under Subchapter V, which simplifies reorganization for small businesses. This allows family-owned businesses to restructure their debts while maintaining control over operations, with fewer administrative burdens than a traditional Chapter 11 case. Texas businesses can continue serving their communities and generating income during the bankruptcy process, but it’s crucial to have a well-developed reorganization plan that addresses creditor concerns and maximizes asset protection for the family. Consulting with an experienced bankruptcy attorney is key to crafting a successful strategy.

If you’ve recently moved to Texas, you may face limitations on claiming the Texas homestead exemption. Federal bankruptcy law imposes a 1,215-day residency requirement before you can use the Texas homestead exemption to protect your primary residence. If you haven’t lived in Texas for at least three years and four months before filing for bankruptcy, you may need to use the exemption laws from your previous state of residence or opt for federal exemptions. This can affect how much equity in your home is protected, making it crucial to work with an attorney to understand your options.

Yes, Texas debtors can choose to use either state or federal bankruptcy exemptions when filing for Chapter 7 or Chapter 13, but you must select one system or the other—you cannot mix and match exemptions. Texas’s state exemptions, especially the homestead exemption, tend to be more favorable for individuals with substantial home equity, while federal exemptions might be better for those with a variety of smaller assets. Choosing the right set of exemptions is critical to protecting your assets, and your attorney will help you analyze which exemption system is best for your unique financial situation.