How to Fill Out a Bankruptcy Schedule C

By Elizabeth Stock

When you file for bankruptcy, there are several forms you must complete to initiate your case. For example, you will file a bankruptcy petition with the bankruptcy court clerk that states your intention to file for bankruptcy. In addition, you must complete several schedules, including Schedule C, which lists the exemptions you wish to take in your bankruptcy case.


An exemption in bankruptcy is an asset that is protected from seizure by your creditors by either federal or state law. In some states, you have the option of choosing between the state’s bankruptcy exemptions or the federally recognized exemptions. For example, if you file for bankruptcy in New Jersey, you have the option of choosing the set of exemptions that is more beneficial to you.

Valuing Property

Placing a value on your property to determine whether it is exempt may not be as simple as it sounds. For example, the value of your property is the property’s current value, not what you paid to acquire it. If you are trying to determine the value of your vehicle, refer to Kelley Blue Book for an estimate of your car’s current fair market value. If you are unsure of your home’s current value, you may need to contact an appraiser to come and view your property and provide you with an accurate estimate of its value.

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Chapter 7 Exemptions

Chapter 7 bankruptcy is a liquidation of your assets to raise funds to repay your creditors. The exemptions that you claim and are eligible to receive will determine what property you are able to keep during and after your Chapter 7 bankruptcy. For example, if your home is worth $130,000 and your state provides up to $135,000 in a homestead exemption, you will be able to keep your home. All non-exempt property may be seized by your bankruptcy trustee and sold, with the funds becoming part of your bankruptcy estate. However, in many Chapter 7 cases, there are few to no assets to sell.

Chapter 13 Exemptions

Chapter 13 bankruptcy is different than Chapter 7 bankruptcy and allows you to keep your property while you make monthly payments to your Chapter 13 trustee during a repayment plan. The repayment plan will generally take between three to five years to complete and must allocate funds to repay all or a significant part of your debt. If you choose to keep property that is not fully exempt in a Chapter 13 bankruptcy, you can exempt the amount allowed by state or federal law, and then continue to make payments toward any outstanding amount. These payments toward your partially exempt property decrease the amount of monthly money you have available to repay your unsecured creditors in your Chapter 13 plan.

Schedule C

First, when you complete Schedule C, you will need to indicate, by checking the appropriate box, whether you are using your state’s exemptions [11 U.S.C. Section 522(b) (3)], or the federal ones [(11 U.S.C. Section 522(b) (2)]. Schedule C also asks you to check a box at the top of the form if you are claiming a homestead exemption that exceeds $146,450, as of 2012. Schedule C is divided into columns, and the first column asks you to describe each asset you are claiming as fully or partially exempt . In column two, you must list the statute that allows you to exempt the property described in column one. In the third column of Schedule C, list the dollar amount of the exemption you are claiming. Finally, in the last column, enter the value of the property, without including the exemption.

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What Is Not Exempt Under Chapter Seven Bankruptcy?


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Federal Vs. State Exemption for Chapter 7

In a Chapter 7 bankruptcy, you ask a federal court for protection from creditors. The court issues an automatic stay, which bars any collection actions or lawsuits against you. The law requires you to provide a list of all your property, including homes, cars, cash, investments, jewelry and other valuables, furniture, and business supplies. A court-appointed trustee may seize some of your property, depending on the type of debt in need of repayment. Federal law provides exemptions that allow you to protect some of your property from seizure. In addition, the states have their own rules regarding exempt property.

Bankruptcy Exemption Requirements

If your debts are out of control and you have little hope of catching up on the bills, you have the option to file for bankruptcy protection. The federal bankruptcy code allows you to file under Chapter 7 or Chapter 13 of the code. In a Chapter 7 bankruptcy filing, a court-appointed trustee seizes your non-exempt property to repay your debts. In a Chapter 13 filing, the trustee sets a repayment schedule, and you are allowed to keep your property. Exemptions are an important consideration in both forms of bankruptcy.

How to File Bankruptcy in Washington State

If your debts are beginning to overwhelm you, you may be considering bankruptcy to help you get back in control of your finances. Since bankruptcy is governed by federal law, the actual process for filing bankruptcy is the same in every state, but certain aspects of the process are determined by state law or by each district's bankruptcy court.


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