HB 1021 adds the Indiana earned income tax credit as an asset that is exempt in bankruptcy.
I’m glad this bill got amended. Early on, I believe there was a plan afoot to take all of a debtor’s exemptions and make them transferable among categories. For example, you currently get a $15,000 exemption for residential property and $300 in cash. As I understood earlier versions of the bill, if you didn’t use up all of one exemption, you could transfer the remainder to another category. So, if you had no residence, but had $15,300 in cash, you could protect all of that cash from your creditors.
I don’t so much mind that in the bankruptcy context, but a person also gets these exemptions in a post-judgment collection proceeding – meaning that I could have been faced with an attempt to collect a $1,000 judgment; found a guy with $10,000 in his bank account; and been unable to take the $1k out of the account. Such a situation would have made me mad.