News & Events
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June 2010
Two New Bills Signed Into California Law – Raising The Homestead Exemption, Permitting Renewal Of Judgment Liens, And Correcting Statutory Inconsistencies Regarding Bankruptcy
by Jack S. Johal
On October 11, 2009, Governor Schwarzenegger signed into law two (2) bills, each of which will become effective January 1, 2010:
Homestead Exemption Increase
Assembly Bill 1046 increased the amount of equity in a homestead that is exempt from the enforcement of a judgment. Under current law, the base exemption is $50,000. There is an exemption of $75,000 if the judgment debtor or the judgment debtor's spouse who resides in the homestead is a member of a family unit, and an exemption of $150,000 if the judgment debtor or the judgment debtor's spouse is age 65 or older, disabled, or age 55 or older with limited income. Under the new law, the exemptions will be increased to $75,000, $100,000, and $175,000, respectively.
The bill also requires the Judicial Council to submit to the Legislature, at three (3) year intervals, recommendations as to the amount by which the exemption should increase based on the change in the annual California Consumer Price Index for All Urban Consumers; however, no further increases will take effect until approved by the legislature.
January 31, 2011 - Taxpayers must be sent IRS Form 1099-R by this date, which reports any distribution from an IRA, including conversion distributions.
Judgment Lien Renewal
Assembly Bill 121 amended the California Code of Civil Procedure to permit a judgment lien creditor to renew a notice of judgment lien filed with the California Secretary of State. Under current law, judgment liens on certain kinds of personal property can be filed in the same manner as a UCC-1 Financing Statement, but they expire after five (5) years and cannot be renewed. As of January 1, 2010, the judgment creditor will be able to file a continuation statement with the Secretary of State's office within the last six (6) months of the judgment lien's validity, thereby renewing the lien for additional five (5)-year terms until the judgment has been satisfied.
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