Is My Bank Account Protected In A Chapter 7 Bankruptcy?
Arizona law allows you to keep $300 in one bank account. A.R.S. § 33-1126(A)(9). This only applies to the day that your chapter 7 bankruptcy petition is filed. It is important to note that that the law does NOT allow you to just withdraw cash to get under the $300 limit and then deposit it back after the petition is filed. The withdrawn cash is non-exempt, or not protected.
So, what do you do if you are over the limit and don’t know what to spend the money on? Some common examples that we recommend are:
- Up to 6 months food, fuel, and provisions
- New tires or repairs for your vehicle
- Doctor visits
You should keep receipts for the purchases to prove how the money was spent. And, as always, it is best to speak with an experienced chapter 7 bankruptcy attorney before spending the money.
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