New Opinion on New Forms
and Exemptions
By Wendell Sherk
St. Louis Missouri Bankruptcy Attorney
www.stlbankruptcy.com
A
s of December 1, 2015, the
Official Forms changed to allow
an exemption claim of “100% of
fair market value (FMV) up to statutory
limit” to be asserted. But what does
that mean? The language comes from
the Supreme Court’s 2010 Schwab v.
Reilly case but, until now, the Schwab
language has appeared infrequently
in case law.
The Schwab Court
addressed when an exemption for a
specific dollar amount would remove
an asset from the estate so that any
increase in value – or error in valuation
– would go to the debtor or the estate.
The Court created this new phrase to
“flag” the debtor’s intention to withdraw
such assets from the estate.
In theory, this balances the debtor’s
goals while putting the trustee and
creditors on better notice than simply a
dollar amount might. In the following
case, Judge Marvin Isgur of the
Southern District of Texas attempts
to provide a clear step-by-step guide
for how the new forms with the 2010
language would seem to play out
in applying exemptions with dollaramount limitations (specif