Some really good news for Oregon Debtors facing bankruptcy. Governor Kitzhaber has signed SB396 into law and
Oregon debtors now have the opportunity to elect federal exemptions or
Oregon exemptions when filing bankruptcy. SB396 reversed the 30 year
ban on use of federal exemptions in Oregon bankruptcy cases. The bill
can be used in all
bankruptcy cases filed after July 1, 2013.
In addition, there has been added to the already existing Oregon exemptions a new exemption for
Health Savings Accounts in an unlimited amount.
What does this mean for Oregon Debtors? It means more ways to protect your property and assets that youare allowed to retain when filing bankruptcy. For example the Oregon exemption for an automobile is $3,000.00. But if you elect to use the Federal Exemption you would be able to exempt a car worth $3,675. The real benefit of using the Federal Exemptions is that you can borrow the unused portion of the Federal Homestead exemption up to $11,500 for an individual can be used instead to increase another Federal Exemption amount.
So you could exempt a car worth up to $15,175 by adding the $11,500 to the existing car exemption of $3,675.00 Or maybe you have some property that doesn't fit into a specific category. Combining the wild car exemption of $1,225 with the transferable amount of $11,500 gives you an exemption of $12,725 to apply to any property you want to keep. (This amount doubles for a married couple for an amount of $25,450.00)
Whether you use the Oregon Exemptions or the Federal Exemptions is something you will need to discuss with your bankruptcy attorney as part of your pre-filing bankruptcy strategy. But this gives you a lot more options. So if you considered filing bankruptcy in the past but were told you would lose certain property which kept you from filing, you might want to talk to a bankruptcy attorney again and see if the outcome will be more favorable given the change in Oregon's exemption laws.
Here is a list of the various Federal Exemptions that can now be used by Oregonians filing bankruptcy if they chose to elect:
11 U.S.C. (Title 11 of the
United States Code) Section 522(d)
522(d)(1), (5) - Real property, including mobile homes and co-ops, or
burial plots up to $22,975. Unused portion of homestead, up to $11,500
may be used for other property.
522(d)(2) - Motor vehicle up to $3,675.
522(d)(3) - Animals, crops, clothing, appliances and furnishings,
books, household goods, and musical instruments up to $575 per item, and
up to $12,250 total.
522(d)(4) - Jewelry up to $1,550.
522(d)(9) - Health aids.
522(d)(11)(B) - Wrongful death recovery for person you depended
522(d)(11)(D) - Personal injury recovery up to $22,975 except for
pain and suffering or for pecuniary loss.
522(d)(11)(E) - Lost earnings payments.
522(b)(3)(C) - Tax exempt retirement accounts (including 401(k)s,
403(b)s, profit-sharing and money purchase plans, SEP and SIMPLE IRAs,
and defined benefit plans). (Fully exempt.)
522(b)(3)(C)(n) - IRAS and Roth IRAs to $1,245,475.
522(d)(10)(A) - Public assistance, Social Security, Veteran’s
benefits, Unemployment Compensation.
522(d)(11)(A) - Crime victim’s compensation.
Tools of Trade:
522(d)(6) - Implements, books and tools of trade, up to $2,300.
Alimony and Child Support:
522(d)(10)(D) - Alimony and child support needed for support.
522(d)(7) - Unmatured life insurance policy except credit insurance.
522(d)(8) - Life insurance policy with loan value up to $12,250.
522(d)(10)( C ) - Disability, unemployment or illness benefits.
522(d)(11)( C ) - Life insurance payments for a person you depended
on, which you need for support.
522(d)(5) - $1,225 of any property, and unused portion of homestead up to $11,500.
Oregon driver's insurance policies must offer a minimum of:
Bodily injury and property damage liability
$25,000 per person; $50,000 per crash for bodily injury to others; and
$20,000 per crash for damage to others property
State law also requires every motor vehicle liability policy to provide:
Personal injury protection (for reasonable and necessary medical, dental and other expenses
incurred up to 1 year after the crash) $15,000 per person. (Coverage for lost wages up to $3,000 a month for up to one year is also part of PIP and is in addition to the medical coverage.)
And the policy must include Uninsured motorist (UM/UIM) coverage of
$25,000 per person; $50,000 per crash
What this means is that if you hit someone, your insurance will pay at most $25,000 maximum to each person injured and no more than $50,000 maximum for the total paid for all injuries. So if you have more than one person with more than $25,000 of injuries, your insurance company won't pay more than the maximum and you may be liable for any judgment in excess of the maximum coverage. This could mean that you may lose your house if you have equity above the current exemption amounts of $40,000 per person and $50,000 per married couple. Scary isn't it?
If you own property that has value, like a nice house with equity or a car worth more than $3,000, it would be wise to talk to an attorney and see how much exposure you have and find out how much more insurance you need to buy to protect yourself.
Now let's look at the protection you have for yourself under your policy. Your UM/UIM will pay you if you are injured by another driver up to $25,000 per person in your car, and up to $50,000 total per accident. Not very much if you are seriously injured by a driver with little or no insurance. One night in the hospital could chew up $25,000.00.
What often surprises people is that if a driver hits you, and has insurance, let's say the minimum required, $25k per person and $50k per accident, you might think that your own policy will then kick in and boost this to more, adding on your own $25k/$50k UM/UIM coverage. But it doesn't. The game is rigged by the insurance rules and underwriters. Currently the two policy amounts won't be combined. You only get your UM/UIM if it exceeds the amount of the other driver's coverage and only get the excess.
One of the best ways to protect yourself is to buy higher um/uim coverage if your insurance company offers it and you can afford it. This may mean buying an umbrella policy.
In Oregon you will also have a minimum of $15,000 in PIP to cover medical expenses. If you have other medical insurance this is probably sufficient. Just be careful if you ever need to use your PIP that you
don't use it all up immeidately for something like chiropractic care, and then find out you need other treatments that your HMO won't cover, like massages. Talk to your personal injury attorney as to ways to monitor and allocate the PIP usaage so you get the maximum benifit.
As an attorney and a member of the pro-consumer pro-Plaintiff group,
OTLA (Oregon Trial Lawyers Association) I want to give you some
information on Oregon candidates that both OTLA and I support because we
believe they will best protect the average citizen, their rights, and
needed legislative reforms that further protect individual rights.
Kate Brown is the incumbent Secretary of State, who is running for
reelection. Before she was elected to be the Secretary of State, she
was the leader of the Democrats in the Oregon Senate where her training
and back ground as a lawyer made her very effective in understanding and
guiding legislative initiatives. The Secretary of State runs the Audit
Division, the Corporations Division and the Elections Division. During
her tenure, the Audit Division has identified millions of dollars in
savings for the State, and has also identified programs that work well.
As head of the Elections Division she has protected Oregon's unique
vote by mail process. In Oregon, we have one of the highest voter
participation rates in the nation, and our system is uniquely free of
fraud. She is a firm advocate of individual freedoms and rights and
very proficient at her job. We are concerned that her opponent does not
have the experience nor the grounded views of protecting individual
rights that the job requires. We need to keep her here.
Brad Avakian is running for reelection as the Labor Commissioner. He is
a Democrat and was a plaintiff's lawyer before he was Labor
Commissioner. The Labor Commissioner enforces Oregon's employment laws.
Avakian has strengthened enforcement of Oregon's Labor laws, and he
has strengthened Oregon's apprenticeship programs. He is fully
committed to protecting Oregon jobs and Oregon workers. We are
concerned that his opponent will undermine the enforcement of Oregon's
laws that protect workers. This is a non-partisan position so the
candidates political party associations are not going to be listed.
However it is important for you to know that he values keeping and
maintaining protections for our workers.
Dick Baldwin is
running for the Supreme Court. Dick has been a trial judge, Director of
Litigation for Legal Aid, and a plaintiff's lawyer. He believes
strongly in the rule of law. He believes that our system of justice
should be open to everyone, and should protect everyone, not just the
rich and powerful. He is experienced, fair and very smart. His
opponent, Nena Cook, has not dedicated her career as a Plaintiff’s
advocate and has limited volunteer experience as a Judge. She may be a
contender for a future position after she has some more experience at
the trial court level as a Judge. But for this election, here and now,
Dick Baldwin is the best choice
Jim Egan is running for a
seat on the Court of Appeals. Jim is a Republican who is dedicated to
the same principles that OTLA supports, having championed the rights of
workers when he was in private practice as a lawyer. He is also a
Captain in the Marine Reserves, and served in Iraq and an experienced
trial judge. He is fully committed to the principles of fairness and
justice for all, regardless of the wealth and power.
Attorney at Law
talk about Auto insurance and three of the most important things to know:
1. Don't drive without insurance, even if you are a good driver: If you get into an accident and don't have
insurance, and the accident wasn't your fault, an attorney would have a
very hard time representing you to help you recover for your damages
because Oregon law prevents uninsured driver's from recovering pain and
suffering damages. (There is an exception if you were insured and the
insurance has just recently lapsed.) Without the extra funds that come
from the pain and suffering portion of your damages, there is little an
attorney can do to help you collect the money needed to fully
compensate you for your medical bills, lost wages and car damages
because there is no extra money from which the attorney can get paid to
do this work. Also, you won't get any money for the suffering you went
through. So bottom line, don't drive without insurance because even if
you avoid causing any accidents, you could still be in big trouble if
someone hits you and you are the one that needs help getting your
Whether or not you the accident was your fault, under Oregon
Law you will be subject to having your driver's license suspended for
one year. You may be able to qualify for a special work driving permit
before your one year suspension is over, but you will have to show proof
of insurance to get that permit.
2. Every Oregon Insurance policy includes PIP (Personal Injury Protection) which means you get up to $15,000 of your related medical bills paid
the first year, no matter who is at fault, and you get 70% of your lost
wages reimbursed up to $3,000.00 per month. So you don't need to panic
and settle your case because you are worried about the fact that you
can't work or that you didn't have medical insurance. PIP will help you
with this giving you time to talk to an attorney and get your case
3. Make sure you raise your Uninsured/Underinsured Motorist coverage. Under Oregon Law all policies have basic coverage of $25,000 per person,
$50,000 per accident. This means if you are in an accident that is not
your fault and the other driver has no insurance then you can get up to
$25,000.00 for your injuries from the UM (Uninsured Motorists) portion
of your policy. But $25,000.00 can't even begin to help you if you are
seriously injured. It will be exhausted with just a few days of
hospitalization. This is the one area of insurance that actually
protects you and your loved ones but it is so often ignored, and it is usually very inexpensive to increase the coverage.
UM also becomes UIM (Under-Insured Motorists) if you are hit by a driver
with less insurance coverage then what you have. Keep in mind that
many other driver's only have the minimum insurance, $25,000 to pay you
if they injure your. It would be wise to get as much UIM coverage as
you can afford. UIM only works to the extent that you buy coverage
greater than what the other driver has. The amount of your policy is
not added to the amount of the other driver's, rather the amount of the
other driver's is subtracted from your UIM and you get the difference.
So if you have $50,000.00 of UIM coverage and the other driver has only
$25,000.00, you could get an additional $25,000.00 from your policy for a
total of $50,000.00 (but you would not get $75,000.00). This is
another reason to aim for the highest coverage you can afford, ideally a
million dollars worth of additional coverage. It may sound like a lot
but it is relatively cheap, especially if you have a good driving
Keep in mind that UM/UIM insurance does not cover your car. You must
also carry full coverage insurance if you want your property damage
covered as well!
planning doesn't just mean doing a will. It means learning how
property transfers with or without a will and making sure you have set
up your financial affairs so that your property goes to the people or
charities that are important to you.
There can also be some tax
planning involved. Most people don't have to worry about Federal Estate
Tax anymore since you don't pay taxes unless you
have an estate over 5 million dollars. However Oregon still begins to
charge estate taxes on estates of 1 million dollars or more. While that
might sound like a lot for most of us, it can be reached when you add
in any life insurance payable on your life to the equation when you die.
That's right, if you buy life insurance on your life the full amount
is includable in your estate for estate tax assessment purposes. So if
two spouses both have large life insurance policies, a home with a lot
of equity, retirement and investment accounts, it is possible to pass
the 1 million mark on paper and incur taxes when the second spouse dies.
(There is no tax for property passed from one spouse to another).
There are some easy fixes particularly for married couples that can
avoid a lot of estate taxes. I like to add a disclaimer trust into my Wills for married couples where the possibility of estate tax is uncertain. It is inexpensive to add this provision and the provision allows people to make an elections after the first spouse dies if they see the need to do some post-mortem planning to avoid estate taxes. The election puts some of the first spouses property into a trust where it can still be used to support the second spouse with some limitations, but the passage into the trust allows the first spouses exemptions from estate tax to apply to that property which would have been lost if the property went directly to the second spouse before passing to the children. Clients with this clause to need some instruction on how to maintain the title of their properties so that it is possible to make the election but it isn't too difficult once you understand some basic concepts.
For more information on Wills and Estate Planning please be sure to check my Articles and Links page.
As 2011 draws to a close some of you are still stunned by the lack of recovery of our economy. Maybe you finally found a new job but it's for lower pay or less hours. You remain buried in debt. This might be a good time to consider getting rid of the debt that piled up during a long period of unemployment or during an extended illness or other calamity that put you behind.
There are limits to the amount of income you can earn and still completely discharge your debt in a chapter 7 bankruptcy so filing when your income is still relatively low may be your best chance to wipe out debt for a fresh start. If you wait until your income improves and still can't pay your debt you might be limited to a chapter 13 bankruptcy plan which will require you to make payments towards your debt for up to 5 years. By using a chapter 7 bankruptcy now to get rid of all your debt, you will be debt free and able to move on in your life rebuilding your credit to again plan for your future retirement and other future needs.
First you are going to want to collect any 2011 tax refunds due to you since unlike wages owed to you where 75% of the back wages are exempt, tax refunds don't get that same favorable treatment in bankruptcy and up to 100% of the tax refund due to you can be collected by a bankruptcy trustee and used to pay your creditors. With some simple advanced planning you can file for your refund as soon as you get your W-2s from your employers and your tax refund will be on it's way. Once you receive the refund you can use the funds to pay for your bankruptcy and spend any additional money on necessities for you and your family.
You can consult with an attorney now about whether bankruptcy is a good option for you. I offer a free preliminary phone consultation and more intensive office screening at a low cost. It is important to talk to an attorney before you spend your tax refund just to certain you don't inadvertently spend it in a way that the bankruptcy trustee will object to or that you buy some other asset that is not exempt and can be taken from you.
As a general rule you can spend your refund on reasonable expenses for food, clothing, shelter and medical expenses as well as attorney fees related to your bankruptcy. It is still a good idea to get legal advice first. Talking to a lawyer about bankruptcy does not commit you to filing a bankruptcy. It is only a preliminary step to explore solutions to your debt situation. In the course of talking to you I might be able to suggest other non-bankruptcy solutions.
For more free information on Bankruptcy please use the tool bar and click on "Articles and Links"
Attorney at Law
Wishing everyone a problem free holiday season, but if there are legal
problems in your life, don't let the worry ruin precious time with
friends and family. Please contact me for a free e-mail or phone
The best way to reach me is by e-mail at
JoanneReisman@PortlandLegalServices.com. If you prefer to call, please
call 503-222-7401 and leave a voice mail message with your phone number
and name so I can call you back. Please understand that I do not often
answer this phone number directly, but frequently check for voice mail
messages and try to return calls on the same day, if you call during the
I can very often offer free helpful suggestions or point out
misconceptions in the law that will reduce your worry and stress
significantly. I am of course here to help you further with legal
services if the problem merits my intervention.
Again, my wished for a safe and happy holiday season to all!
Attorney at Law