People who have been injured in an accident, such as an auto accident or a work related accident, may have significant unpaid medical bills, or may take on credit card debt in order to make ends meet. Because of these unplanned but necessary expenses, an accident may cause a person to consider bankruptcy. However, many people in this situation hesitate to seek relief from their debts because they may also be entitled to a settlement or workers compensation. They fear that if they declare bankruptcy, they will lose out on that money, and not be fairly compensated for their pain and suffering, or for work lost.
Fortunately, the bankruptcy courts protect people who find themselves in that unfortunate situation. The law specifically allows anyone who is entitled to a settlement or award for personal injury or death (whether from an accident or other cause), or entitled to worker's compensation to keep up to $50,000 of that settlement or award. This means that a person who has been injured can be fairly compensated for their loss, but also avoid the crushing medical and credit card debt that can come from hospital stays, medical tests, doctor visits, and being out of work.
The reason personal injury and workers compensation settlement funds are not lost in an Oklahoma bankruptcy is that the Bankruptcy Court has set out certain assets in bankruptcy that are exempt from creditor claims. Oklahoma has some of the best exemptions in the country because they include more types of exempt assets then found in other states.
The way to make sure that your personal injury settlement money is exempt you must follow some simple steps. The first is that the injury funds must not be mixed in with other money that you have in your checking account. This is called commingling injury settlement funds with other money and it's not good. I advice=se my personal injury clients who are considering bankruptcy in Oklahoma to create a new and separate checking account for the settlement money. Once they get the settlement money due them from the personal injury claim put only this money in the new account. Once this is done never mix any other money in with it. Simply draw money out of the account and this will help you maintain its bankruptcy exempt status.
If you are facing a mountain of debt due to your injury accident and want to explore your options for bankruptcy relief in Oklahoma, don't hesitate. Reach out to your local bankruptcy attorney and find out how the law can help you get back on your feet and not lose your personal injury settlement funds.
Charles J. Kania is a writer for law firms that handle personal injury accidents and bankruptcy. From his law firm in Claremore Oklahoma he helps Rogers County residents understand personal injury and bankruptcy law. His legal articles are easy to understand. Additionally he writes about Family law, Criminal law, and Estate Planning law. For more information go to his Claremore Attorneys Blog