I recently posted something about the new two-year bankruptcy exemption rule on the Bankruptcy Law Network site. The provision is found at 11 U.S.C. 522(b)(3)(A). Here's an example of how that rule works as applied to a hypothetical Massachusetts bankruptcy debtor. Let's say the hypothetical debtor has lived in Massachusetts for the past year, lived in Vermont for the year before that, and before that lived in Florida for five years. The Massachusetts resident files bankruptcy. Because the debtor did not live in the same state for the entire two-year period before the filing it is necessary to go back and look at the 180 day period before the two-year look-back period. During that time the debtor lived in Florida. So Florida's state exemption law applies. This means that the debtor has Florida state law exemptions to utilize; but it also means that Florida's opt out provision applies, rendering the federal exemptions unavailable. These federal exemptions would normally be available in Massachusetts, but here the only exemption law available would be what exists under the state law of Florida and under federal nonbankruptcy law.
