Idaho Law Blog
By Stephen J. Muhonen, Creditor’s Rights / Collections Attorney, Racine Olson, PLLP
I was looking up something the other day on the internet when I came across my blog dated January 23, 2020. I took a minute to look at it and immediately noticed some of the exemptions have changed over the course of the last five years. The following is an updated itemization of property exempt from creditors whom are attempting to collect on judgments they have obtained against debtors.
Prior to commencing legal action against a debtor, one of the first things I discuss with new clients is whether the debtor has any assets that can be collected upon. In my opinion, an attorney taking on a new client in this circumstance, without initially exploring collection opportunities or options, is performing a great dis-service to the client. The client came to the attorney with the hope of being paid that for which they are entitled. If a lawsuit is filed and all that is obtained is a “toilet-paper” judgment (the judgment is worthless because there is nothing to be had), then what has the client gained? Now of course I realize and recognize that sometimes the collectability of a pursued judgment cannot always be readily discovered, but there should at least be some attempt to see if collection or recovery is even going to be a possibility.
When performing the due diligence of exploring debtor’s assets, the investigation and analysis should take place with an eye on what assets may be subject to exemptions. Now, just because there are or may be statutory exemptions in place pertaining to the debtor’s property, that does not necessarily mean that one should avoid pursuing the debtor’s property. It is up to the debtor to assert the claim of exemption and to do it timely. If this is not done, the creditor may continue to execute/levy/garnish the property. Some of the exemptions available to debtors are:
Wages: Generally, 75% of disposable earnings, unless 75% of the disposable earnings is less than 30 times the federal minimum wage, then debtor is entitled to keep 30 times the federal minimum wage. See I.C. §11-207 for additional information and considerations pertaining to wage garnishments.
Burial Plot: I.C. §11-603(1).
Health Aids: I.C. §11-603(2).
Benefits: I.C. §11-603(2-6). Social Security, veteran’s benefits, (enforcing child support benefits though is another matter), federal, state or local public assistance, medical, surgical and hospital care, and the amounts in a medical savings accounts, child support and unemployment compensation.
Retirement Benefits: I.C. §11-604(A). Government pensions, IRA’s, 401(k)s and 403(b) accounts, pensions, disability allowances, death benefits.
Workers Compensation Benefits: I.C. §72-802.
Support: I.C. §11-604(1)(a)(b). Disability or illness benefits, alimony, support, or maintenance.
Bodily Injury/Wrongful Death Proceeds: I.C. §11-604(1)(c).
Life Insurance Proceeds: I.C. §11-604(1)(d).
Items of Trade/Business: I.C. §11-605(3). Books, equipment, tools of the trade (Total value cannot exceed $10,000.00).
Guns: I.C. §11-605(8). Can claim an exemption on one (1) firearm and value cannot exceed $1,500.00.
Food and Water: I.C. §11-605(4). 12 month supply and storage.
Homestead: I.C. §55-1003. $175,000.00 exemption. See also I.C. §55-1002 which provides if the owner of real property is married, the homestead may consist of the community or jointly owned property of the spouses or the separate property of either spouse. Each spouse may separately claim a $175,000.00 exemption, for a combined total of $350,000.00.
Household items: I.C. §11-605(1). Furniture, appliances, etc. (Total cannot exceed $7,500.00 and value per item cannot exceed $1,000.00).
Jewelry: I.C. §11-605(2). Exemption is up to $1,000.00.
Motor Vehicle: I.C. §11-605(3). Can only claim an exemption on one (1) motor vehicle and the exemption is up to $10,000.00.
This list is not to be considered exhaustive as to available exemptions, but its purpose is to help creditors understand that even if debtors have “stuff,” that does not necessarily mean it can be taken to satisfy a debt. If you are a creditor seeking assistance in collecting a debt that a debtor is refusing to pay, give Stephen Muhonen at Racine Olson, PLLP, a call at 208-232-6101. You can also email Steve at steve@racineolson.com