What happens to my pets, cats, horses, and animals in bankruptcy?

Generally, they are safe.  animals in bankruptcy

Utah provides an exemption that protects the value of your animals up to a total of $1,000 in value.  The Utah Code section that applies here is:

78B-5-506. Value of exempt property — Exemption of implements, professional books, tools, and motor vehicles.
(1) An individual is entitled to exemption of the following property up to an aggregate value of items in each subsection of $1,000:
(a) sofas, chairs, and related furnishings reasonably necessary for one household;
(b) dining and kitchen tables and chairs reasonably necessary for one household;
(c) animals, books, and musical instruments, if reasonably held for the personal use of the individual or the individual’s dependents;
(d) heirlooms or other items of particular sentimental value to the individual; and
(e) firearms and ammunition not included in other exemption categories in the amount of $250 per individual, and not more than $500 per household.

This means that I can protect up to $1,000 of the value of your pets.  You will hate it when I say this, but we generally list pets (like dogs and cats) at meat value, which is very, very low.  No bankruptcy trustee would want to take your 8 year old Labradoodle and try to sell him to earn a few dollars for the bankruptcy estate.  Remember that it is very hard for a trustee to quickly liquidate the value of a used pet.

The real problem arises when you have animals whose value exceeds that $1,000 threshold, such as A.  livestock, B. horses, or C. animals kept for breeding.

A.  Livestock — If you have livestock, you may be looking at a special kind of bankruptcy called a chapter 12, which applies to family farmers and fisherman.

B.  Horses —- They are expensive to maintain, expensive to purchase, and hard to sell.  Usually, we can value the horses low enough that a trustee would not be interested in them.  If you have a horse worth more than the exemption limit, we may have to file a chapter 13 case to protect the value of your horse.

C.  Breeding Stock — If you breed animals, such as AKC Registered Poodles, then your animals may or may not be worth more than the exemption limit.  If the value is too high, then we’re stuck filing a chapter 13 to protect their value.

Generally, your animals are safe.  However, if you have a concern, this is definitely a question to bring up with your attorney.

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