Will I lose my equipment for my landscaping business if I file for bankruptcy?

Most likely no.

In Utah, we can exempt up to $5000 of “tools of the trade,” which includes things like lawnmowers, rakes, shovels, etc.  If you’re feeling technical, you can find the exemption under Utah Code Ann. s 78B-5-506(2).  We normally value your equipment at a garage sale value and not at a replacement value, so most of my clients can protect all of their equipment.

What gets more confusing is whether or not you can protect your trailer, and in most cases, yes we can.  Even better, if you owe money on the trailer, you can reaffirm the debt, or agree to pay back the secured creditor after bankruptcy.  If you owe money, there’s probably no equity for me to worry about protecting.

I can protect your truck as a tool of the trade or as a family motor vehicle, but I cannot double the exemption.  landscaping truckI can protect one vehicle total (per spouse), up to $3,000 in value as a family vehicle.  Or, I can protect up to $5,000 of total tools, equipment, and truck as a tool of your trade.

So, generally, no, so long as you are running a one man show with your landscaping business, you probably don’t have anything to lose in bankruptcy.

This is not legal advice.  If you need help go to www.robertspaynelaw.com.

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