Bankruptcy Laws in Oregon
Oregon law lists the types of assets that are exempt from being sold to satisfy a court judgment against a debtor. These statutory exemptions are available to debtors who seek protection from creditors under federal bankruptcy laws. The Oregon statutes provide a homestead exemption for a debtor, as well as an exemption for several categories of personal property. A wage exemption is not available in a bankruptcy proceeding.
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Bankrupcty Proceedings
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Federal law provides the framework for deciding bankruptcy cases in Oregon, which are heard in the U.S. Bankruptcy Court for the District of Oregon. An individual, husband and wife, corporate entity or partnership may file a Chapter 7 bankruptcy petition under federal law. Debtors who seek bankruptcy in Oregon must satisfy a means test in order to qualify for a Chapter 7 bankruptcy. Debtors whose income is less than the Oregon median income as determined according to U.S. Census Bureau data do satisfy the means test. For a debtor whose income exceeds the state median income, the court will examine the debtor's income during the previous six months.
Exempt Property
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A Chapter 7 proceeding involves liquidation of assets by selling the debtor's non-exempt property and using the proceeds from the sale to pay off the debts. Chapter 18 of the Oregon Revised Statutes lists the types of property that are exempt from the execution of a bankruptcy judgment. Oregon law also provides (Ore. Rev. Stat. 18.300) that as specified in federal bankruptcy laws, Oregon residents are not entitled to use the property exemptions listed in Section 522(d) of the federal Bankruptcy Code. The Bankruptcy Court in Oregon has stated: "Oregon law requires that a debtor in bankruptcy use the Oregon statutory exemption scheme" (In re Platt, Case No. 301-36561-rld7, December 7, 2001).
Wage Exemption
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A wage exemption is not available to debtors under Oregon law. Section 18.385 of the Oregon statutes does provide an exemption for 75 percent of an individual's disposable earnings for payment under a garnishment order. However, the provision also specifically states that this exemption does not apply to "any order of a court of bankruptcy."
Homestead Exemption
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The Oregon statutes (Section 18.395) provide a homestead exemption up to a value of $30,000, or a combined value of $39,600 if two or more members of the household are debtors in the bankruptcy proceeding. The availability of the homestead exemption to a debtor is also limited to 160 acres of land, or 1 city block.
Personal Property
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Section.345 provides an exemption for personal property, up to specified dollar limits. Property that is exempt includes books, pictures and musical instruments; apparel, jewelry and personal items; a debtor's occupational tools; a motor vehicle to the value of $2,150; domestic animals and poultry that are raised for household's own use; and household goods.
Also exempt under this provision are spousal support, child support and separate maintenance that is necessary for the support of the debtor and dependent children; prescribed health aids; the debtor's right to an award under a crime victims reparation law; the debtor's right to an award for bodily injury to the debtor or a dependent; veterans' benefits and loans; and the debtor's right to an earned income tax credit.
Section 18.358 provides that the personal property exemption applies to 75 percent of a beneficiary's interest in a retirement plan. Section 18.362 lists an exemption for 1 shotgun or rifle, and 1 pistol, up to a value of $1,000.
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