Determining the Fair Market Value of Assets that May Be Exempt in an Indiana or Kentucky Bankruptcy
In an Indiana or Kentucky Chapter 7 bankruptcy, an individual or couple filing for bankruptcy protection may be entitled to retain certain assets, such as household furniture, vehicles, jewelry, and appliances. The bankruptcy statutes provide that certain types of assets are completely exempt from creditors, and that other assets may be exempt up from creditors up to certain dollar limitations. The assets that are exempt are often referred to as “Indiana exempt assets” or “Kentucky exempt assets.” In the case of assets that may be exempt, the fair market value of such assets must be determined.
How is Fair Market Value Determined?
In the bankruptcy process, all assets must be listed in the bankruptcy petition, and an associated fair market value must be provided. Determining the fair market value of assets in a bankruptcy is often highly subjective.
Fair market value does not depend upon how much was paid for a particular item, but rather how much the item could be sold for in a commercially reasonable manner. For many household items, fair market value may be estimated by determining how much the item could be sold for in a garage or similar sale.
For other items, such as jewelry, the best method for determining fair market value may be to see how much a pawn shop or a retail jewelry purchaser would pay for a particular item. The fair market value for jewelry, for instance, is not equal to the purchase price at the jewelry store.
With real estate, it may be necessary to have property appraised by a qualified appraiser.
It is important to note that the exempt asset bankruptcy provisions apply only to individuals and couples filing for Chapter 7 Bankruptcy protection, not companies.
We Can Help You Understand How Fair Market Value Should Be Determined
As Southern Indiana and Kentucky bankruptcy attorneys, we can advise you and answer any questions that you may have concerning the process of determining the fair market value for your property, as well as any other questions that you might have. We stand by our clients throughout the duration of their bankruptcy proceedings and provide attentive and dedicated representation for every client’s matter.
We invite you to call us today to schedule a free, no-obligation consultation. At this meeting, we can learn about your situation and can explain the options that are available.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.