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How Much of Your Personal Injury Award Can You Keep After Bankruptcy?

How Much of Your Personal Injury Award Can You Keep After Bankruptcy?

Bankruptcy has the potential to swallow up a large part of the award you receive from a personal injury claim. How much you get to keep depends on the exemptions that apply. Every state has their own set of exemptions, and the federal government provides exemptions, too. Sometimes, you have to use the state exemptions (as in Ohio); other times, you can choose which set you use (as Kentucky allows).

Exemptions for personal injury claims in Ohio

Bodily Injury

Under Ohio Rev. Code § 2329.66(A)(12)(c), the exemption is $23,000 for personal injury claims. This amount only covers bodily injury to yourself or your dependent. Any part of the award provided for pain and suffering is not part of the exemption.

Lost Wages

You may have the opportunity to exempt 75 percent of any award provided to you for lost wages. However, it is important to consult an experienced attorney familiar with bankruptcy law in Ohio to determine the best way to protect your award.

Future Wages

Under Ohio Rev. Code § 2329.66(A)(13)(b) you can exempt the portion of your award covering lost future wages if you demonstrate you actually need the financial support it provides and you receive it within the year before you file.

Wrongful Death Suits

Under Ohio Rev. Code § 2329.66(A)(12)(b), you may exempt a portion or all of the compensation you received in a wrongful death suit for a deceased individual upon whom you were dependent, under two conditions:

  1. You received compensation within one year prior to filing your bankruptcy, and
  2. You can demonstrate that you require the money to financially support yourself and your dependents.

General Exemptions

Under Ohio Rev. Code § 2329.66(A)(3), you may exempt $450 in cash or in a bank account that can help you protect a portion of your personal injury compensation if you have previously received the settlement payment.

In addition, under Ohio Rev. Code § 2329.66(A)(18), the state provides you with a wildcard exemption up to $1,225. You may use this money to protect part of a personal injury claim or any asset.

It is important to remember that combining settlement funds with money derived from other sources can cancel out your exemptions. Therefore, keep your personal injury compensation funds in a separate account.

Exemptions for personal injury claims in Kentucky

The state of Kentucky provides specific exemptions involving personal injury awards, too. Kentucky Rev. Stat. Ann § 427.150 protects:

  • Maximum of $7,500 from a personal injury award stemming from an injury to yourself or your dependent. The exemption is allowed in the amount necessary to support yourself and your dependents.
  • Awards for future earning losses to the degree reasonably required to support you and your dependents

Kentucky Rev. Stat. Ann § 427.150 allows for a wildcard exemption up to $1,000.

However, the federal exemptions, which are available in Kentucky, are more generous:

The bankruptcy code personal injury exemption according to 11 U.S.C. 522(d)(11)(D) allows you to keep up to $23,675 from a personal injury award or settlement. This does not include compensation for monetary losses or pain and suffering. If a couple files together as plaintiffs, this amount may double to $47,350.

If you have suffered an injury due to the negligence of another party in Ohio or Kentucky, we are here to fight on your behalf for the compensation you need at this time. To learn more about how we can represent you effectively in a personal injury claim, schedule a free consultation with an attorney from our team at Crandall & Pera Law. Simply call us today at 877.686.8879 or fill out our contact form or use our contact form to send us a message

 

 

 

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