Bankruptcy Schedules: Schedule C

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Gregory W. Mitchell

Gregory W. Mitchell

Attorney

469.998.8486
gmitchell@freemanlaw.com

Gregory Mitchell joins Freeman Law to lead its bankruptcy practice. Mr. Mitchell is a native of the Dallas area, graduating from Southern Methodist University with a Bachelor’s Degree in Economics in 1991 and with his J.D. in 1994. In 1995, he obtained an LL.M. in Taxation from New York University. Mr. Mitchell currently directs the SMU Dedman School of Law’s federal taxpayer clinic. Mr. Mitchell’s background in tax makes him a natural fit for Freeman Law.

Prior to joining Freeman Law, Mr. Mitchell was the managing partner of The Mitchell Law Firm, L.P., a small firm he started in 2004, where he ran a diverse practice primarily focused on bankruptcy, tax and related litigation matters.

Prior to starting his own firm, Mr. Mitchell served as a Partner and General Counsel with Tax Automation, L.P., a national tax consulting firm. Mr. Mitchell was previously the National Director of Tax Technology at Ryan & Company, a national tax consulting practice, as well as a Senior Manager with KPMG, a “Big Four” accounting firm.

This will continue our series on bankruptcy schedules. In a prior blog post, we looked at Schedule A/B.  Today, our focus will be on Schedule C related to the claiming of exemptions.

In a bankruptcy case, Schedule C is an important form that allows debtors to claim exemptions for certain property. Exemptions are legal provisions that allow debtors to protect certain assets from being seized and sold by the bankruptcy trustee to pay off creditors. In this blog post, we’ll go over the basics of completing Schedule C in a bankruptcy case.

Step 1: Understand Your State’s Exemptions

Before you can start filling out Schedule C, you need to understand the exemptions that are available to you in your state. Each state has its own set of exemptions, and some states allow debtors to choose between state and federal exemptions. Make sure to consult with a bankruptcy attorney to understand your state’s exemptions and which ones may be applicable to your case.

Step 2: Identify Property to Claim as Exempt

Once you’ve identified the exemptions available to you, the next step is to identify the property that you want to claim as exempt. This can include things like your home, car, personal property, and other assets that are protected by state or federal exemptions.  This includes things like protected accounts like IRAs and 401(k), along with a variety of other items that varies by state.

Step 3: Classify Your Exempt Property

Once you’ve identified the property that you want to claim as exempt, you’ll need to classify it according to the categories listed on Schedule C. These categories include:

Be sure to list each item of exempt property under the appropriate category, and include the value of each item.

Step 4: Complete the Form

Once you’ve classified your exempt property, it’s time to complete the form itself. The form will ask for your name, case number, and other basic information, as well as a detailed listing of your exempt property. Make sure you or your attorney fills out the form completely and accurately, and don’t leave anything out. If you’re not sure about how to classify an item or determine its value, seek the advice of a bankruptcy attorney.  If you fail to correctly identify assets that you are claiming as exempt, then an asset may be subject to seizure by the trustee and sale for the benefit of your creditors.

Step 5: Review and File

After you or your attorney has completed Schedule C, review it carefully to make sure everything is accurate and complete. Once you’re satisfied with the form, you or your attorney must file it with the bankruptcy court, along with the rest of your bankruptcy paperwork.

Like other schedules, completing Schedule C is an important part of the bankruptcy process.  Schedule C is particularly important when it comes to getting the “fresh start” promised by the bankruptcy process because it determines what assets you will be able to keep following your bankruptcy case.  By following these steps and seeking the guidance of a bankruptcy attorney if needed, you can ensure that your exempt property is accurately listed and protected, and that your bankruptcy case proceeds smoothly.

 

Resources

 

Bankruptcy Schedules

 

Bankruptcy Attorneys

Need assistance in managing the bankruptcy process? Freeman Law attorneys offer unique cross-disciplinary expertise in taxation, litigation, and forensic accounting and asset tracing, positioning the Firm to handle complex bankruptcy litigation on behalf of debtors, creditors, and trustees, as well as bankruptcy taxation matters. Our Firm offers value-driven services and provides practical solutions to navigate complex bankruptcy laws. Contact Freeman Law to schedule a consultation or call (214) 984-3000 to discuss your tax or bankruptcy concerns.