Asset Protection Archives | Steven Grace Law

New Illinois Bankruptcy Exemptions in 2026: What Debtors Can Keep

new exemption relief from Public Act 104-0120

Asset Protection, Bankruptcy, Citations to Discover, Collection Defense / Steven J. Grace

Illinois has finally updated its exemption laws for the first time in decades, giving families stronger protections in both bankruptcy and collection defense. Starting January 1, 2026, Public Act 104-0120 raises the Illinois homestead exemption to $50,000 per person ($100,000 joint), increases protections for vehicles and tools of the trade, creates a new $5,000 household goods exemption, and streamlines bank account freezes with a $1,000 automatic exemption. These changes mean more homeowners can keep their equity, more debtors can shield everyday property, and citation return hearings will be simpler and faster.

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Fraudulent Conveyances and Bankruptcy

Asset Protection, Bankruptcy / Steven J. Grace

I frequently receive inquiries about whether transferring a house into a friend’s name before filing for bankruptcy is a viable strategy. Beyond the severe risks of bankruptcy fraud, there are other crucial considerations. A Chapter 7 or Chapter 13 bankruptcy trustee has the authority to invalidate such transfers, potentially selling the property and distributing the

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Illinois Wage Garnishment Laws

image signifying the keys needed to unlock wage garnishments

Asset Protection, Bankruptcy / Steven J. Grace

A wage garnishment, also known as a wage attachment or wage deduction, is Court order that instructs your employer to withhold a specific amount of money from your paycheck and send it directly to a creditor. In most cases, a creditor cannot garnish your wages without obtaining a court-issued money judgment first. For example, if

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Tenancy by the Entirety in Bankruptcy: Protecting Your Home in Tough Times

locks that symbolize the asset protection of tenancy by the entirety

Asset Protection / Steven J. Grace

Tenancy by the entirety offers married couples in Illinois strong protection for their homes, shielding the property from being sold to satisfy a judgment against only one spouse. While creditors can record a lien on a debtor spouse’s contingent future interest, such as the right of survivorship, this lien is unenforceable as long as the tenancy remains intact. However, creditors may assert claims against the property in probate if the judgment debtor predeceases their spouse. For those facing financial difficulties, bankruptcy often provides a more definitive solution, potentially removing liens and resolving debts efficiently while protecting the home.

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