State of MI v. Schafer, No. 11-1340 (6th Cir. 2012)
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In 2009, the debtor filed a voluntary Chapter 7 bankruptcy petition. Michigan law permits debtors in bankruptcy to choose exemptions from: 11 U.S.C. 522(d); a set of general exemptions available to all Michigan residents irrespective of bankruptcy status, Mich. Comp. Laws 600.6023; or a list of exemptions available solely to debtors in bankruptcy, Mich. Comp. Laws 600.5451. The debtor chose a homestead exemption under the last option, which permits only bankruptcy debtors to exempt up to $30,000 of the value of the home, or up to $45,000 if the debtor is over the age of 65 or disabled. The figures are adjusted for inflation triennially, such that the debtor, who is disabled, claimed a total exemption of $44,695 in the value of his home; the federal exemption would be $21,625 and the Michigan general homestead exemption was $3,500. The trustee filed an objection. The Bankruptcy Court upheld the exemption. The Sixth Circuit affirmed. The phrase “uniform Laws” in the Bankruptcy Clause permits states to act in the arena of bankruptcy exemptions, without violation of the Supremacy Clause, even if they do so by making certain exemptions available only to debtors in bankruptcy
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