Sports Memorabilia in Bankruptcy
Can I Keep Sports Collectibles or Sport Memorabilia in Bankruptcy?
Collecting sport memorabilia can be an enjoyable, lifetime hobby. If the hobby grows, sometimes it can even turn into a business. Sports memorabilia can reach up to a very high value level for particularly desirable items. Ball cards, autographs, and historical items can sometimes generate unbelievable sale values. Unfortunately, even sports memorabilia collectors also find themselves in bankruptcy situations. Can you keep sports memorabilia in bankruptcy? The answer to this question usually is based on the aggregate value of the items.
Value is the Key Factor in Bankruptcy to Sports Memorabilia and Collectibles
We all know people who own thousands of well organized baseball cards. We have seen entire houses decorated with sports memorabilia items. The key factor to whether you can keep these items in bankruptcy is not the extent of the collection. They key factor is the aggregate value.
During a bankruptcy case, you are required to total up the value of all of your assets. This also requires you to total up the aggregate value of your sports memorabilia. The total value of your memorabilia will most likely be listed under Section 8 of your property listing. This section is entitled “collectibles.” You will be required to use a reasonable method for reaching an accurate value of these items. Rough estimates and personal knowledge may be a good place to start. A professional estimator or appraiser may also be required to reach an accurate value.
The Bankruptcy Trustee and Your Exemption Protection
You will be automatically assigned a Chapter 7 trustee in your district when you file your bankruptcy case. This trustee will review your assets. It is also possible that the trustee will require you to present your sports collectibles to the trustee’s personal appraiser. This is allows the trustee to verify the value of the items that you have submitted on your bankruptcy petition.
Depending on your state, you are only allotted a certain amount of exemption protection. This amount determines how much of your sports memorabilia you can keep. In Indiana, you can use the “general tangibles” exemption that can be used to protect all of your basic property. This exemption currently for $10,250 per person. It doubles to $20,500 when a married couple files a joint bankruptcy petition.
Within Indiana, keep in mind that you will also need to protect your other property such as automobiles, furniture, and other personal items that you own. This can deplete your “general tangible” exemption until much less remains to protect your sports items. In such a case, you may only have $8,000, $6,000, or even much less to claim as an exemption on your sports memorabilia. Also, keep in mind that every state varies on what exemptions are offered during a bankruptcy case. In certain states, you may have a very limited exemption towards the specific purpose of retaining sport memorabilia in bankruptcy. As with all bankruptcy planning, make sure to contact a local bankruptcy attorney. They will be able to represent you in bankruptcy with a clear explanation as to what is possible in your area when you own expensive sports memorabilia items.
