Florida Bankruptcy Law (FL)

New bankruptcy law reform act and the cap on state homestead value exemption

One of the most unique features about Florida bankruptcy laws pertains to the unlimited value placed on state homestead exemptions. As of 2005 however, a new bankruptcy law reform act created a cap on all state homestead exemptions. In the past, many creditors considered Florida as a debtor's haven, yet filing statistics did not bear out creditor fears. Nevertheless, Floridians are now subject to federal restriction of their homestead exemption, and further restricted by income for qualification for Chapter 7. To qualify for Chapter 7, debtors may not earn over the median state income, but are still entitled to file Chapter 13.

In all cases, state law determines the extent of liability for transactions originating within the state. Divorce, tort claims, and even criminal responsibility for fines and restitution are also matters of state law. When filing, many cases include what lawyers refer to as a case within a case, that is, the necessity of litigating claim propriety before receiving a discharge.