Urgent: Homestead Exemption Based on Disability
Posted: Thu Jul 17, 2014 9:00 pm
Ok, Mike, that is why I raised the question. As long as the case law sticks to the filing date we will have predictable exemptions. Since the six month rule is part of the statute, a rule that you have to wait six months make sense, but just extrapolating to lots of other contingencies, will not likely become part of the code.
D
Dennis McGoldrick, 350 S. Crenshaw Bl., #A207B, Torrance, Ca 90503 310-328-1001-voice
> On Jul 17, 2014, at 7:21 PM, "Michael Avanesian michael@avanesianlaw.com [cdcbaa]" wrote:
>
> This is an interesting issue. According to the snapshot rule, the homestead exemption is a vested interest subject to divestment. You get it for 6 months and you lose it if you do not protect it.
>
> What about the amount?
>
> Ex1. Debtor is 40 years old married to a 70 year old non-debtor spouse. Debtor is entitled to 175k exemption as long as he is married. If marriage is dissolved i.e. death or divorce, the exemption drops down to 75k. What happens if Debtor reinvests 175k in a new homestead. Wife dies and now he is only entitled to 75k, does the 100k that is no longer exempt get sucked into the Estate? Or is he entitled to the amount as of petition date?
>
> Ex2. Debtor is "disabled" in such a way that he cannot obtain substantial gainful employment. He is entitled to 175k exemption. Sometime after petition date (say 1 week), he recovers. He is now only entitled to 75k exemption. Or is he entitled to amount as of petition date?
>
> These exemptions all have a contingent remainder feel to them. You get the exemption but it's conditioned on (Ex1) remaining married or (Ex2) remaining disabled at the time the sale is to occur: 704.730(a)(3) - "(3) One hundred seventy-five thousand dollars ($175,000) ... at the time of the attempted sale." This language seems like the intent of the California legislature is to provide the exemption only so long as the contingency continues to be satisfied.
>
> I know something is wrong with my analysis but I can't put my finger on it. The reason I say something is wrong is because in Chapter 11, I have seen Debtors retain their homestead exemption on a home even if they move out before the house is sold; apparently because their homestead is locked in on the Petition Date. Maybe Jacobson changed all this. I don't know how much reliance one can have on pre-Jacobson law.
>
> Sincerely,
> Michael Avanesian
>
>> On Thu, Jul 17, 2014 at 11:07 AM, Frank Ruggier frank@pricelawgroup.com [cdcbaa] wrote:
>>
>> Maybe the disability only needs to last as long as the homestead exemption, 6 months. LOL.
>>
>>
>>
>> Frank X. Ruggier
>> Price Law Group, APC
>> 15760 Ventura Blvd., Suite 1100
>> Encino, CA 91436
>> Direct: (818) 205-2406
>> Fax: (818) 907-2106
>> www.pricelawgroup.com
>>
>>
>>
>> Sent: Thursday, July 17, 2014 11:05 AM
>>
>>
>> To: cdcbaa@yahoogroups.com
>> Subject: RE: [cdcbaa] Urgent: Homestead Exemption Based on Disability
>>
>>
>>
>>
>> You want to argue that for me Dennis? Ill find a case for you. lol
>>
>>
>>
>> Sent: Thursday, July 17, 2014 11:04 AM
>> To: cdcbaa@yahoogroups.com
>> Subject: Re: [cdcbaa] Urgent: Homestead Exemption Based on Disability
>>
>>
>>
>>
>>
>> In light of the new 9th Cir case about the six month reinvestment requirement, I wonder if the 9th Cir would add a requirement that the disability be permanent?
>>
>>
>>
>> d
>>
>> Dennis McGoldrick, 350 S. Crenshaw Bl., #A207B, Torrance, Ca 90503 310-328-1001-voice
>>
>>
>>
>>
>> On Jul 15, 2014, at 1:48 PM, "Giovanni Orantes go@gobklaw.com [cdcbaa]" wrote:
>>
>>
>>
>> Thank you, Larry.
>>
>> Sent from my iPhone
>>
>>
>> On Jul 15, 2014, at 12:39 PM, "Larry Simons larry@lsimonslaw.com [cdcbaa]" wrote:
>>
>>
>>
>> There are several Neff cases. Try this link:
>>
>>
>>
>> http://scholar.google.com/scholar_case? ... as_sdt2006
>>
>>
>>
>> Sent: Tuesday, July 15, 2014 12:33 PM
>> To: cdcbaa@yahoogroups.com
>> Subject: Re: [cdcbaa] Urgent: Homestead Exemption Based on Disability
>>
>>
>>
>>
>>
>> In re Neff does not discuss ccp 704.730.
>>
>>
>>
>> On Tue, Jul 15, 2014 at 11:38 AM, Larry Simons larry@lsimonslaw.com [cdcbaa] wrote:
>>
>>
>>
>> Neff v. Denoce (In re Neff, 2014 Bankr. LEXIS 471, *25 (9th Cir. BAP 2014).
>>
>>
>>
>>
>>
>> Sent: Tuesday, July 15, 2014 11:35 AM
>> To: cdcbaa@yahoogroups.com
>> Subject: RE: [cdcbaa] Urgent: Homestead Exemption Based on Disability
>>
>>
>>
>>
>>
>> I have been searching for exactly that issue and cannot find that requirement.
>>
>>
>>
>> Sent: Tuesday, July 15, 2014 10:45 AM
>> To: cdcbaa@yahoogroups.com
>> Subject: [cdcbaa] Urgent: Homestead Exemption Based on Disability
>>
>>
>>
>>
>>
>> Under CCP 704.730, you can claim the higher $175,000 exemption if a debtor is disabled as of the date of the petition. In Re Rolland, 317 B.R. 402 (C.D. Cal. 2004). Is anybody aware of an interpretation of that statute requiring that the disability be "permanent"?
>>
>>
>>
>> --
>>
>> Giovanni Orantes, Esq.*
>>
>> Orantes Law Firm, P.C.
>> 3435 Wilshire Blvd. Suite 2920
>> Los Angeles, CA 90010
>> Tel: (213) 389-4362
>> Fax: (877) 789-5776
>> e-mail: go@gobklaw.com
>> website: www.gobklaw.com
>>
>> *Board Certified - Business Bankruptcy Law - American Board of Certification
>>
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>>
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>> Estate Planning
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>> Outside General Counsel
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>> WE ARE A "DEBT RELIEF AGENCY" AS DEFINED BY FEDERAL LAW.
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>>
>>
>>
>>
>>
>> --
>>
>> Giovanni Orantes, Esq.*
>>
>> Orantes Law Firm, P.C.
>> 3435 Wilshire Blvd. Suite 2920
>> Los Angeles, CA 90010
>> Tel: (213) 389-4362
>> Fax: (877) 789-5776
>> e-mail: go@gobklaw.com
>> website: www.gobklaw.com
>>
>> *Board Certified - Business Bankruptcy Law - American Board of Certification
>>
>> *Board Certified - Consumer Bankruptcy Law - American Board of Certification
>>
>> Commercial Litigation
>>
>> Estate Planning
>>
>> Outside General Counsel
>>
>>
>>
>> WE ARE A "DEBT RELIEF AGENCY" AS DEFINED BY FEDERAL LAW.
>>
>> SERVING BAKERSFIELD, LOS ANGELES, ORANGE COUNTY, RIVERSIDE, SAN BERNARDINO AND SANTA BARBARA AND THE WORLD FOR CHAPTER 11 AND 15 CASES.
>>
>> Note: The information contained in this e-mail message is confidential information intended only for the use of the individual or entity named. If the reader of this message is not the intended recipient or an agent responsible for delivering it to the intended recipient, you are hereby notified that any dissemination, distribution or copy of this communication is strictly prohibited. If you have received this communication in error, please immediately notify us by telephone or e-mail and delete the original e-mail >>
>> IRS Circular 230 Disclosure: In order to comply with requirements imposed by the Internal Revenue Service, we inform you that any U.S. tax advice contained in this communication (including any attachments) is not intended to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein.
>>
>>
>
>
On Jul 17, 2014, at 7:21 PM, "Michael Avanesian michael@avanesianlaw.com [cdcbaa]" <
This is an interesting issue. According to the snapshot rule, the homestead exemption is a vested interest subject to divestment. You get it for 6 months and you lose it if you do not protect it.
What about the amount? Ex1. Debtor is 40 years old married to a 70 year old non-debtor spouse. Debtor is entitled to 175k exemption as long as he is married. If marriage is dissolved i.e. death or divorce, the exemption drops down to 75k. What happens if Debtor reinvests 175k in a new homestead. Wife dies and now he is only entitled to 75k, does the 100k that is no longer exempt get sucked into the Estate? Or is he entitled to the amount as of petition date?
Ex2. Debtor is "disabled" in such a way that he cannot obtain substantial gainful employment. He is entitled to 175k exemption. Sometime after petition date (say 1 week), he recovers. He is now only entitled to 75k exemption. Or is he entitled to amount as of petition date?
These exemptions all have a contingent remainder feel to them. You get the exemption but it's conditioned on (Ex1) remaining married or (Ex2) remaining disabled at the time the sale is to occur: 704.730(a)(3) - "(3) One hundred seventy-five thousand dollars ($175,000) ... at the time of the attempted sale." This language seems like the intent of the California legislature is to provide the exemption only so long as the contingency continues to be satisfied.
I know something is wrong with my analysis but I can't put my finger on it. The reason I say something is wrong is because in Chapter 11, I have seen Debtors retain their homestead exemption on a home even if they move out before the house is sold; apparently because their homestead is locked in on the Petition Date. Maybe Jacobson changed all this. I don't know how much reliance one can have on pre-Jacobson law.
Sincerely, Michael AvanesianOn Thu, Jul 17, 2014 at 11:07 AM, Frank Ruggier frank@pricelawgroup.com [cdcbaa] <cdcbaa@yahoogroups.com> wrote:
Maybe the disability only needs to last as long as the homestead exemption, 6 months. LOL.
The post was migrated from Yahoo.