In contrast to the New York State Homestead Exemption, the Federal Bankruptcy Homestead Exemption is currently $25,150.00 and there is a Wildcard Exemption, if no Homestead Exemption is taken, of $13,900. The Wildcard Exemption can be applied towards cash or any other asset whether or not there is an independent exemption amount for that asset. For example, the Wildcard Exemption could be used to increase the car exemption if the value of the car exceeded the $4,000 federal motor vehicle exemption. The Wildcard Exemption can even be used, with limitation up to $12, 575, for any unused part of their homestead exemption. Federal Exemptions are also updated every three years.
A bankruptcy debtor has the option of choosing between the Federal and New York State Exemptions but it is all one scheme or the other, no mixing is allowed. It is important to select the proper exemption scheme to maximize property that can be retained. The difference between the New York and Federal Homestead Exemptions is $154,825. Similarly there is a $7,900 difference between the New York State cash exemption and the Federal Wildcard Exemption. Both the state and federal exemption statutes outline exemption amounts for basically all property. However, due to the large differences in amounts that can be protected, the Homestead Exemption and the Cash/Wildcard exemptions generally require the most attention.