Bankruptcy in New Mexico
For this Albuqurque Bankruptcy Attorney, filing a bankruptcy is routine if not common. However, for the average client filing for bankruptcy, it is their first, and hopefully only, time. This process can be scary. Most people don’t know what their rights are in a bankruptcy, nor which of their assets or personal pieces of property they can protect. Everyone struggles with personal finances, especially in these times of economic downturn. There is nothing to be ashamed of, much less intimidated by bankruptcy.
New Mexicans are lucky in that they have two different sets of exemptions that they can choose from that allow them to better protect their assets and personal property. All states have their own laws regarding the exemptions present in their bankruptcy codes, and so too does the federal government. Not all states, however, allow their citizens to chose from either the state or federal list of exemptions. Exemptions, in this context, means specific categories of assets, real property and personal property that the government cannot force you to sell through the bankruptcy process in the act of paying off your creditors.
The following are the assets that are exempt from seizure through bankruptcy in the state of New Mexico under the New Mexico Statutes Annotated (1978):
New Mexico Bankruptcy Exemptions
| ASSET | EXEMPTIONS | NMSA 1978 SECTION |
|---|---|---|
| Homestead (your home) |
Married, widowed, or supporting another may claim real property up to $60,000 (joint owners can double this)
|
42-10-9 |
| Insurance |
– Benevolent Association benefit up to $5,000 – Fraternal benefit society benefits – Life, accident, health or annuity benefits, withdrawal or – cash value, if beneficiary is a New Mexico citizen |
42-10-459A-44-1842-10-3 |
| Miscellaneous |
– Ownership interest in an unincorporated association – Property of business partnership – Workers’ Compensation |
53-10-354-1-25 |
| Pensions |
– Pension or retirement benefits – Public school employees |
42-10-1, 42-10-222-11-42A |
| Personal Property |
– Books, health equipment and furniture – Building materials – Clothing – Cooperative association shares, minimum amount needed to be a member – Jewelry up to $2,500 – Materials, tools and machinery to dig, torpedo, drill, – complete, operate, or repair oil lines, gas wells or pipelines – Motor vehicle up to $4,000 |
42-10-1, 42-10-248-2-1542-10-1, 42-10-253-4-2842-10-1, 42-10-270-4-12
42-10-1, 42-10-2 |
| Public Benefits |
– AFDC, general assistance – Crime victims’ compensation paid before July 1, 2993 – Occupational disease disablement benefits – Unemployment compensation |
27-2-2131-22-1552-3-3751-1-376 |
| Tools of your Trade |
$1,500
|
52-1-52 |
| Wages |
Minimum of 75% of your earned but unpaid wages, or more for low income debtors in bankruptcy
|
35-12-7 |
| General |
– $500 worth of any personal property – $2,000 worth of any property in lieu of your homestead |
42-10-142-10-10 |
Federal Bankruptcy Exemptions
FEDERAL BANKRUPTCY EXEMPTIONS
| ASSET | EXEMPTIONS | 11 U.S.C. SECTION |
|---|---|---|
|
Homestead (your home) / Real Property
|
Up to $20,200
|
522(d)(1) |
|
One (1) Motor Vehicle
|
Up to $3,225
|
522(d)(2) |
|
Household Goods and Clothing
|
Up to $10,755
|
522(d)(3) |
|
Jewelry
|
Up to $1,350
|
522(d)(4) |
|
Unused homestead value (aggregate of interest in any property, not exceeding $1,075 + up to $10,125 of unused value from homestead exemption)
|
Up to $11,200
|
522(d)(5) |
|
Tools of your trade
|
Up to $2,025
|
522(d)(6) |
|
Life insurance policies (Unmatured)
|
Exempt if needed for support
|
522(d)(7) |
|
Life insurance cash/loan value
|
Up to $10,755
|
522(d)(8) |
|
Prescribed health aids
|
Exempt as needed for support
|
522(d)(9) |
|
Social Security, unemployment, public assistance, veterans’ benefits, disability, alimony, and child support.
|
– Exempt if needed for support – IRA, ERISA pensions & 401(k) plans up to $1,095,000 |
522(d)(10) |
|
Wrongful death, life insurance proceeds, and loss of future earnings payouts
|
– Exempt if needed for support – Personal injury claims not including pain and suffering or pecuniary damages up to $20,200 |
522(d)(11) |
|
Retirement accounts (as defined by the Internal Revenue Code)
|
Up to $1,095,000
|
522(d)(12) |
Be sure to talk with a bankruptcy attorney if you have questions regarding bankruptcy in New Mexico.