Filter Results

15.3.4 Tools of the Trade; Property Used in Agriculture

CategoriesCart
Highlight Updates
  1. Collection Actions
  2. Chapters
  3. Chapter 15 Protecting the Debtor’s Home, Tangible Personal Property, and Other Assets
  4. 15.3 Tangible Personal Property: Household Goods, Vehicles, Health Aids, Tools of the Trade; Tenancy by Entireties in Personal Property
  5. 15.3.4 Tools of the Trade; Property Used in Agriculture

15.3.4 Tools of the Trade; Property Used in Agriculture

A useful exemption found in many state statutes protects “tools of a trade.” In defining tools of the trade, many states apply a use test, holding that an item is a tool of the trade if it is actually used by the debtor in their usual trade on a regular basis and is reasonably necessary to that trade.210 Others, however, use a narrower definition and confine the exemption to personal items of modest value.211 Some decisions hold that real estate cannot be a tool of the trade.212 A computer system was found to be a tool of a trade when the employer furnished software so the debtor could work at home, even though work at home was not mandatory.213 The Kansas tools-of-trade exemption has been applied to a website and digital images used by a photographer who sold digitally manipulated images to the public.214

A “tools of the trade” exemption may be used in some jurisdictions to exempt a vehicle that is necessary to the debtor’s livelihood. Courts differ on the question of whether the existence of a specific exemption for motor vehicles means that the “tools of the trade” exemption cannot also be applied to a vehicle.215 Extending the exemption to vehicles is more consistent with the rule that exemption laws are to be construed liberally,216 especially since preservation of the debtor’s earning capacity is of great importance in accomplishing the purposes of these laws.

To exempt a vehicle as a tool of the debtor’s trade, something more than commuting must often be shown,217 but it may be sufficient if the debtor’s job requires visits to widespread job sites or transportation of equipment or products.218 An independent owner-operator may be allowed to exempt a truck.219 Courts have been less receptive to the argument that a vehicle is a tool of the debtor’s trade when the debtor owns other vehicles or the vehicle in question has luxury features.220

Some states limit tools of the trade to the debtor’s principal occupation.221 Wyoming has construed an exemption for tools used for “carrying on [the debtor’s] trade or business” to limit only the number of exemptions: the debtor may exempt the tools of one part-time occupation or several, up to the $2000 cap, but may not claim an exemption for each trade.222 A debtor who seeks to exempt the tools of a casual or part-time occupation may be required to prove that it is more than a hobby and that there is at least an expectation of profit.223 A debtor who is not currently practicing a trade but intends to return to it may be able to claim a tools-of-the-trade exemption, depending on the strength of the evidence.224 A debtor who does business as a limited liability company or other corporate entity may be able to exempt personally-owned tools,225 but not tools owned by that entity.226

While a tools-of-the-trade exemption is often applied to farm equipment, some states have an earmarked exemption for property used in agriculture.227 Courts often allow these exemptions to debtors who have full-time, off-farm jobs but are still devoting significant time to farming228—or who temporarily cease farming but intend to return to it.229

Footnotes

  • 210 In re Simpson, 2014 WL 1096138 (Bankr. D. Me. Mar. 19, 2014) (taxicab is tool of trade); In re Weimann, 2009 WL 383426 (Bankr. C.D. Ill. Feb. 13, 2009) (applying use test; boats and trailer of modest value were tools of trade for boat rental business, not capital assets, so are exempt under Illinois law); In re Giles, 340 B.R. 543 (Bankr. E.D. Pa. 2006) (applying use test for federal bankruptcy exemption; standard motor vehicle was tool of trade for artisan who made hats and sold at craft fairs; public transportation not a reasonable alternative for buying materials and attending shows); In re Gray, 303 B.R. 632 (Bankr. W.D. Mo. 2003) (applying use test; horses and cattle used to teach riding and roping are tools of trade of riding and rodeo skills instructor); In re Aurelio, 252 B.R. 102 (Bankr. N.D. Miss. 2000) (tools are exempt if reasonably necessary for the performance of debtor’s occupation; restaurant equipment qualifies but not proceeds of its sale in absence of evidence of intent to resume the business). See also In re Gregory, 245 B.R. 171 (B.A.P. 10th Cir. 2000) (Wyo. law) (applying use test, but Air Force security officer’s practice pistol was not a means of carrying on his trade, when he had another pistol which he actually carried while on duty and employer did not require practice pistol), aff’d, 246 F.3d 681 (10th Cir. 2000); In re Siegel, 214 B.R. 329 (W.D. Tenn. 1997) (lawyer in solo practice could exempt computer system as tool of trade; rejecting test whether item is “uniquely suited” to use in the trade, in favor of fact-based consideration of the role of computers in a modern law office); In re Mackey, 209 B.R. 251 (Bankr. E.D. Okla. 1997) (Oklahoma tools-of-the-trade exemption should be broadly construed to include not only small, handheld things but also any other property which is “reasonably necessary, convenient or suitable for [the owner’s] trade or profession”; allowing independent truck driver to exempt up to $5000 limit for value of Peterbilt truck). Cf. In re Nipper, 243 B.R. 33 (Bankr. E.D. Tenn. 1999) (reciting use test but confining Tennessee tools-of-trade exemption to hand tools of small value, not capital assets or major pieces of machinery such as independent trucker’s tractor-trailer). But cf. In re Taylor, 2008 WL 1805384 (Bankr. S.D. Ill. Apr. 18, 2008) (Illinois does not have a specific exemption for livestock; animals used for breeding are capital assets, not tools of trade, so not exempt); In re Rollins, 2007 WL 2428079 (Bankr. W.D. Mo. Aug. 17, 2007) (certificates of deposit, used to post security required by statute in order for debtor credit repair service to receive advance payments from customers, is not tool of trade, as the business may be conducted without it).

  • 211 In re Gonzalez, 2017 WL 2831215 (Bankr. C.D. Cal. June 27, 2017) (Cal. law) (cash cannot be tool of trade); In re Hively, 358 B.R. 752 (Bankr. C.D. Ill. 2007) (limiting exemption to tools of modest value, but here cargo trailer, worth less than statutory cap, was exempt when it was used to haul food and cooking equipment by caterers who cooked at events); In re Gentry, 297 B.R. 553 (Bankr. C.D. Ill. 2003) (Illinois exemption is construed narrowly to cover only artisans’ “tools of modest value”; self-employed contractor may not exempt Bobcat regardless of its use); In re Nipper, 243 B.R. 33 (Bankr. E.D. Tenn. 1999) (reciting use test but confining Tennessee tools-of-trade exemption to hand tools of small value). See also In re Nickeas, 503 B.R. 453 (Bankr. W.D. Wis. 2013) (liquor license not tool of trade; limiting definition to personal items of modest value, such as “rakes and hand tools”); Restroppo v. All. Riggers & Constructors, Ltd., 538 S.W.3d 755 (Tex. App. 2017) (denying Texas exemption; domain name is not a tool, equipment, book, or apparatus). Cf. In re Baldowski, 191 B.R. 102 (Bankr. N.D. Tex. 1996) (property need not be “peculiarly adapted” to the trade but must be “tools” or “apparatus”; ordinary dishes, cutlery, tables, exempt as tools of the trade of a cafe owner).

  • 212 See, e.g., In re Maestas, 497 B.R. 167 (B.A.P. 10th Cir. 2013) (table; text available at 2013 WL 3786719) (Colorado exemption applies only to personal property, not real estate); In re Montgomery, 2010 WL 3369829 (Bankr. N.D. Ohio Aug. 23, 2010) (denying exemption to building equipped for use in debtor’s business; definition of “implement” cannot be stretched to cover real property).

  • 213 In re Biancavilla, 173 B.R. 930 (Bankr. D. Idaho 1994). See also In re Siegel, 214 B.R. 329 (W.D. Tenn. 1997) (lawyer in solo practice could exempt computer system as tool of trade); In re Carson, 184 B.R. 587 (Bankr. N.D. Okla. 1995) (Oklahoma tools-of-trade exemption protects lawyer’s computer system). But see In re Massey, 2009 WL 2848861 (Bankr. E.D. La. Apr. 23, 2009) (debtor who, on petition date, had separate business office not allowed to exempt home office equipment); In re Hoffpauir, 258 B.R. 447 (Bankr. D. Idaho 2001) (computer not tool of trade when debtor wife sometimes worked at home, but no evidence that this was required; evidence that employer supplied software or equipment would be probative).

  • 214 In re MacMillan, 546 B.R. 213 (D. Kan. 2015) (statute covered “documents” and images here were “electronic documents”). But cf. In re White, 234 B.R. 388 (Bankr. W.D. Tex. 1999) (custom software which debtor computer programmers had created and licensed to their employer was not a tool but a product of their trade and thus was not exempt).

  • 215 EXEMPTION NOT BARRED: In re Woller, 483 B.R. 886 (Bankr. W.D. Wis. 2012) (over-the-road truck driver could exempt semi-tractor despite existence of specific exemption for motor vehicle); In re Gaydos, 441 B.R. 102 (Bankr. N.D. Ohio 2010) (applying principle of liberal interpretation to conclude that Ohio’s provision of specific exemption for motor vehicle does not bar use of tools-of-trade exemption for truck used to earn living); In re VanWinkle, 265 B.R. 247 (Bankr. D. Colo. 2001) (truck may be exempted as tool of the trade even though state also provides a specific motor vehicle exemption; independent truck driver may exempt truck). See also In re Letizia, 2014 WL 184438 (Bankr. D. Ariz. Jan. 14, 2014) (vehicles used by sole proprietorship may be exempted only as tools of trade; motor vehicle exemption applies only to vehicles for personal or household use).

    EXEMPTION BARRED: In re Belsome, 434 F.3d 774 (5th Cir. 2005) (Louisiana’s specific exemption for motor vehicles trumps general tools-of-trade exemption; school bus exempt only up to amount of motor vehicle exemption); In re Cleavers, 407 B.R. 354 (B.A.P. 8th Cir. 2009) (under Iowa law, motor vehicle can be exempted only under specific motor vehicle exemption, not tools of trade, but may be tool of trade for purposes of lien avoidance under bankruptcy law); In re Gaddy, 2014 WL 5488441 (Bankr. W.D.N.C. Oct. 22, 2014) (unmodified pick-up truck, used to deliver large water tanks, not a tool of trade; motor vehicle may be exempted only under specific motor vehicle exemption).

  • 216 See § 13.3.1, supra.

  • 217 In re King, 451 B.R. 884 (Bankr. N.D. Iowa 2011) (car used only for commuting not tool of trade under federal bankruptcy definition, even if loss of car will cause loss of job); In re Taylor, 2005 WL 846222 (Bankr. D. V.I. Apr. 7, 2005) (motor vehicle not a tool of a trade unless it is itself used a tool, for example, as a taxi or a tow truck). See also In re Caldero Padilla, 2014 WL 183669 (Bankr. D. P.R. Jan. 14, 2014) (Social Security recipients’ car not exempt because not used for work); In re Stewart, 2013 WL 5793441 (Bankr. D. Neb. Oct. 28, 2013) (overlooking explicit statutory language and holding that Nebraska does not exempt vehicle used only for commuting); In re Sedillo, 476 B.R. 619 (Bankr. D. Colo. 2012) (car used to transport foster children to daily activities not a tool of trade; foster parenting not a “gainful occupation” covered by Colorado exemption); In re White, 352 B.R. 633 (Bankr. E.D. La. 2006) (vehicle used for commuting not exempt tool of trade under federal bankruptcy exemptions); Cf. In re Rivera, 499 B.R. 175 (Bankr. D. P.R. 2013) (Puerto Rico exemption for horse and wagon used by professional covers motor vehicle if used in carrying out professional responsibilities). But see Neb. Rev. Stat. § 25-1556 (explicitly exempting motor vehicle required to get to work); In re Cardwell, 2013 WL 4874323 (Bankr. D. Neb. Sept. 12, 2013) (Nebraska exempts car used for commuting, but federal law does not; applying federal definition to deny lien avoidance, even though debtor was required to use Nebraska exemptions); In re Reisdorff, 2010 WL 4852457 (Bankr. D. Neb. Nov. 27, 2010) (spouses who each used jointly owned vehicle to commute to work could stack two tools of trade and two wildcard exemptions).

  • 218 In re Sackett, 394 B.R. 544 (Bankr. D. Colo. 2008) (allowing tools-of-trade exemption for nurse supervisor’s sports utility vehicle; employer did not provide vehicle, and job required her to transport equipment and training materials to healthcare facilities and patients’ homes); In re Black, 280 B.R. 258 (Bankr. D. Colo. 2002) (self-employed building contractor may exempt truck used to tow equipment and transport tools to worksites, as otherwise debtor could not practice his occupation); In re Clifford, 222 B.R. 8 (Bankr. D. Conn. 1998) (tools of trade of building contractor included pickup truck used to transport workers and materials to job sites, lift truck, crawler loader, and fax machine used for bidding, all of which were necessary to enable debtor to compete as contractor); In re Lyall, 193 B.R. 767 (Bankr. E.D. Va. 1996) (automobile is “necessary” within meaning of the Virginia “tools of a trade” exemption if debtor would be unable to compete effectively without it; when self-employed architect used car frequently to visit job sites and attend meetings with municipal officials, it was exempt); Charlie’s Concrete Servs., Inc. v. Anthony, 2009 WL 2342523 (V.I. Super. Ct. July 24, 2009) (motor vehicle can be tool of trade if “reasonably necessary” to debtor’s occupation; one truck or van is reasonably necessary to enable building contractor to move tools and equipment to worksites). See also In re Garcia, 709 F.3d 861 (9th Cir. 2013) (remanding to bankruptcy court to determine whether car was realtor’s tool of trade); In re Giles, 340 B.R. 543 (Bankr. E.D. Pa. 2006) (standard motor vehicle was tool of trade under federal bankruptcy exemptions for artisan who made hats and sold at craft fairs; public transportation not a reasonable alternative for buying materials and attending shows). Cf. In re Rawn, 199 B.R. 733 (Bankr. E.D. Cal. 1996) (car would be “tool of the trade” only if debtor’s occupation was “uniquely dependent on” its use, for example, a realtor who showed houses to prospective buyers). But see In re Robinson, 2010 WL 4053667 (C.D. Ill. Oct. 14, 2010) (car used occasionally to call on customers or make deliveries not exempt; tools of trade limited to artisans’ tools of small value); In re Mitchell, 2018 WL 1442256 (Bankr. N.D. Ga. Mar. 21, 2018) (denying exemption to tutor who used car to visit clients; must show that occupation is “uniquely dependent” on driving, such as travelling sales representative); In re Erwin, 199 B.R. 628 (Bankr. S.D. Tex. 1996) (more than “general value and use in business” was required to make a car a tool of the trade; when debtor was a constable who served process, but any four-door car, including a rental, would serve, car was not exempt).

  • 219 In re Gaydos, 441 B.R. 102 (Bankr. N.D. Ohio 2010) (applying principle of liberal interpretation to conclude that Ohio’s provision of specific exemption for motor vehicles does not bar use of tools-of-trade exemption for truck used to earn living); In re VanWinkle, 265 B.R. 247 (Bankr. D. Colo. 2001) (independent truck driver may exempt truck); In re Mackey, 209 B.R. 251 (Bankr. E.D. Okla. 1997) (Oklahoma tools-of-trade exemption should be broadly construed to include not only small, handheld things but also any other property which is “reasonably necessary, convenient or suitable for [the owner’s] trade or profession”; allowing independent truck driver to exempt up to $5000 limit for value of Peterbilt truck). See also In re Woller, 483 B.R. 886 (Bankr. W.D. Wis. 2012) (taking narrow view of exemption; truck is “integral part” of trucking business, but noting that car is not a tool of trade for realtor, or van for plumber). But see In re Nipper, 243 B.R. 33 (Bankr. E.D. Tenn. 1999) (confining Tennessee tools-of-trade exemption to hand tools of small value, not capital assets or major pieces of machinery such as independent trucker’s tractor-trailer)

  • 220 In re Balck, 2011 WL 6130418 (Bankr. D. Colo. Dec. 8, 2011) (refusing to exempt vehicles, including a motorcycle and an antique auto, when debtors had already exempted a pick-up truck and trailer, more suitable for use in their excavation business); In re Heimbouch, 246 B.R. 895 (Bankr. D. Neb. 2000) (Nebraska exemption for motor vehicle used in connection with business did not exempt farmer’s classic Corvette, although sometimes used for farm business, when farmer also owned pickup trucks and jeep). See also In re Black, 225 B.R. 610 (Bankr. M.D. La. 1998) (tools-of-trade exemption would protect truck, which debtor did not personally drive, when debtor depended on income from truck for her living, but denying exemption because truck’s size brought it within former statute’s definition of non-exempt “luxury automobile”); In re Juhasz, 208 B.R. 32 (Bankr. S.D. Tex. 1997) (ordinary Porsche used to call on customers and deliver jewelry and collectibles was not a tool of the trade when there was no modification which adapted it for particular use as a delivery vehicle).

  • 221 In re Lampe, 278 B.R. 205 (B.A.P. 10th Cir. 2002) (Kan. law) (spouses could apply tools-of-trade exemption to farm equipment when farming was principal occupation, even though both spouses also worked off-farm), aff’d, 331 F.3d 750 (10th Cir. 2003); Seel v. Wittman, 173 B.R. 734 (D. Kan. 1994) (lawn mower used in side business not exempt); In re MacMillan, 2015 WL 148339 (Bankr. D. Kan. Jan. 9, 2015) (allowing wife who did accounting, purchasing, and promotion for husband’s business to claim tools-of-trade exemption, when husband, who earned most of his living at other job, was not allowed to claim this exemption); In re Weddington, 457 B.R. 102 (Bankr. D. Kan. 2011) (denying exemption for equipment used by debtor as hunting guide for about four weeks per year; debtor had year-round job, from which he earned nearly all his income); In re Shoemaker, 2009 WL 3244750 (Bankr. D. Kan. 2009) (tools-of-trade exemption only for tools of principal occupation; when couple owned cows and were trying to build a herd, but wife worked as LPN in nursing home, cattle raising was not principal occupation); In re Cordova, 394 B.R. 389 (Bankr. E.D. Va. July 28, 2008) (former contractor, who earned living at desk job, could not exempt tools and truck used for weekend and evening carpentry work); In re Kieffer, 279 B.R. 290 (Bankr. D. Kan. 2002) (wife’s principal occupation was farming, even though she also worked off the farm); In re Zink, 177 B.R. 713 (Bankr. D. Kan. 1995) (construing Kansas “principal occupation” language to allow exemption for tools of only that occupation). Cf. United States v. Neuzil, 2010 WL 4116853 (N.D. Iowa Oct. 1, 2010) (federal tools-of-trade exemption inapplicable to coin collection when debtor failed to show he was in business of buying and selling coins; kept no records and sold only occasionally), report and recommendation adopted, 2010 WL 4115392 (N.D. Iowa Oct. 19, 2010). But cf. In re Rudolph, 2018 WL 5733506 (Bankr. D. Kan. Oct. 30, 2018) (elderly farmers, whose primary source of income was Social Security, could apply tools-of-trade exemption to equipment actually used in their reduced farming operations). But see In re Thompson, 311 B.R. 822 (Bankr. D. Kan. 2004) (may exempt tools of more than one occupation, as long as activity “has a legitimate business or profit motive,” but one $7500 cap applies to total for all trades; even if principal occupation test applied, farm equipment was exempt when husband farmed at least forty hours a week and wife devoted “considerable energy and personal resources” to farm); Kono v. Meeker, 126 Cal. Rptr. 3d 208 (Cal. Ct. App. 2011) (denying exemption for antique dealers’ inventory of antique tools, as they did not use items as tools in the exercise of their trade). .

  • 222 In re Bechtoldt, 210 B.R. 599 (B.A.P. 10th Cir. 1997) (Wyo. law) (allowing debtor who worked primarily as plumber—but also as painter—to exempt painting tools).

  • 223 In re Sharp, 490 B.R. 592 (Bankr. D. Colo. 2013) (fact issues whether boats, ATV, firearms, fishing equipment, used in three-year-old guiding business, now running at substantial loss, were tools of a “gainful occupation”), aff’d, 508 B.R. 457 (B.A.P. 10th Cir. 2014). See also In re Stone, 504 B.R. 908 (Bankr. C.D. Ill. 2014) (ride-on lawn mower not tool of trade; debtor mowed neighbors’ lawns for small fee and ball diamond for free, but most of his income came from other sources and he did not hold himself out to public as yard worker); In re McHugh, 2010 WL 2176298 (Bankr. D. Idaho May 27, 2010) (debtor can exempt tools for a second occupation if necessary for financial support; however, not shown here where debtors, a physician and an accountant, raised alfalfa and horses and were trying to establish vineyard primarily to keep a favorable agricultural zoning classification, but their small-scale efforts often lost money and most of their income came from their professions); In re Wilkinson, 2010 WL 821345 (Bankr. D. Kan. Mar. 5, 2010) (debtor estopped from exempting tools for his “side job” because he reported no income from it on tax returns); In re Goss, 352 B.R. 309 (Bankr. E.D. Okla. 2006) (farm equipment not exempt when farmer was retired or, at most, farming only as “hobby”).

  • 224 Planned Parenthood of Columbus/Willamette, Inc. v. Am. Coal. of Life Activists, 2007 WL 4118597 (S.D. Ohio Nov. 16, 2007) (minister not presently serving as pastor may claim books as tools of trade where he writes and plans someday to return to preaching; considerations include time away and whether debtor has reasonable prospect of returning to trade); In re Quintero, 2012 WL 3638504 (Bankr. D. Neb. Aug. 22, 2012) (must show ability and intention to return; allowing exemption of car for debtor who had been unemployed because of illness but was recovered and using car in job hunt); In re Ferro, 2010 WL 310857 (Bankr. S.D. Tex. Jan. 21, 2010) (allowing debtor who had been boat builder for thirty-three years to exempt boat molds; two boat resellers testified that they would advance him money to build boats when market improved); In re Weimann, 2009 WL 383426 (Bankr. C.D. Ill. Feb. 13, 2009) (operator of boat rental business, who had suspended operations for one year, had reasonable prospect of return when he had already negotiated contract with city); Girgis v. Macaluso Realty Co., 778 So. 2d 1210 (La. Ct. App. 2001) (temporary non-use of tools does not eliminate exemption); Landry v. Landry, 917 A.2d 1262 (N.H. 2007) (incarcerated debtor could exempt mechanics’ tools; had worked as mechanic before imprisonment and intended to do so upon release). But see In re Blackburn, 2011 WL 160608 (Bankr. D. Idaho Jan. 19, 2011) (Idaho exempts only tools needed to make a living; issue is whether tools are needed for support; when builder, whose company could not find work during economic downturn, was earning living as laborer, builders’ tools were not exempt). But cf. In re Pickard, 2012 WL 4919791 (Bankr. N.D. Iowa Oct. 15, 2012) (shop and skid loader, used in now defunct business, not exempt); In re Massey, 2009 WL 2848861 (Bankr. E.D. La. Apr. 23, 2009) (must show that debtor is gainfully employed in a trade or profession and that tools are necessary to that work; debtor who had started writing a novel but never received income for writing not gainfully employed, so home office non-exempt); In re Cordova, 394 B.R. 389 (Bankr. E.D. Va. 2008) (former contractor, who earned living at desk job, could not show intention to return; return was contingent on improvement in housing market, which might take years); In re Tracy, 2008 WL 5225840 (Bankr. D. Neb. Dec. 12, 2008) (Nebraska allows tools-of-trade exemption for vehicle used for commuting; temporary interruption of employment does not bar exemption, but disabled debtor who had not worked for two years failed to show that he could return to former employment); In re Behnke, 2008 WL 4951975 (Bankr. D. Neb. Nov. 18, 2008) (debtors who were unemployed on petition date could not claim tools-of-trade exemption for car); In re Fehmel, 2008 WL 2151797 (Bankr. W.D. Tex. May 22, 2008) (denying exemption to debtor who reported no income from use of tools, formerly used in failed business), aff’d on other grounds, 372 Fed. Appx. 507 (5th Cir. 2010); In re Banke, 275 B.R. 317 (Bankr. N.D. Iowa 2002) (considering intensity of past business, sincerity of intent to return, prospects for return, lapse of time, and other circumstances; boat not tool of trade of fishing guide when not used for twelve years, during which time debtor worked full time at other occupation); In re Aurelio, 252 B.R. 102 (Bankr. N.D. Miss. 2000) (tools-of-trade exemption did not cover proceeds of sale of equipment, when no intent to invest in new equipment and resume business).

  • 225 In re Calderon, 501 B.R. 726 (Bankr. D. Colo. 2013) (debtor who incorporated his small business as S Corporation could exempt tools he personally owned and used in the business; debtor had owned them long before he incorporated).

  • 226 In re Checiek, 492 B.R. 918 (Bankr. M.D. Fla. 2013) (denying reverse veil piercing for truck owned by debtor truck-driver’s wholly owned corporation; distinguishing cases in which lenders have required debtors to incorporate to evade usury laws); In re Gardner, 2013 WL 3804594 (Bankr. D. Colo. June 19, 2013) (no exemption for assets of partnership, which is separate legal entity); In re Miller, 2011 WL 4018267 (Bankr. D. Colo. Sept. 8, 2011) (debtor cannot exempt property owned by corporation). But see In re Schwab, 378 B.R. 854 (Bankr. D. Minn. 2007) (allowing exemption when debtor did business as limited liability corporation but purchased tools in own name using personal credit line; also noting the possibility of “reverse veil piercing” for individual or family business).

  • 227 Painewebber, Inc. v. Murray, 260 B.R. 815 (E.D. Tex. 2001) (when rural homestead was used for agriculture, debtor could exempt tractor, riding mower, and pick-up truck under agricultural exemption, in addition to vehicle allowed by motor vehicle exemption); In re Larson, 260 B.R. 174 (D. Colo. 2001) (livestock used for breeding is exempt); In re Crump, 533 B.R. 567 (Bankr. N.D. Tex. 2015) (Texas law exempts farming vehicles and implements without any requirement that debtor be using them); Devine v. Devine, 2005 WL 1926038 (Bankr. N.D. Iowa Aug. 5, 2005) (farming equipment exempt). See also In re Stokesberry, 2013 WL 4806426 (Bankr. S.D. Tex. Sept. 5, 2013) (tractor used to clear brush on debtor’s and neighbors’ land is “farming or ranching implement” within meaning of Texas personal property exemption). But cf. In re Grimlie, 439 B.R. 710 (B.A.P. 8th Cir. 2010) (Minn. law) (denying exemption for property used in agriculture; debtors do not meet statutory requirement that they be principally engaged in farming where property was used to raise horses and hay but most income came from manufacture and sale of equipment); In re Hintzman, 2007 WL 80964 (Bankr. D. Minn. Jan. 8, 2007) (debtors not principally engaged in farming—and therefore not entitled to farm machinery exemption—where they had four-year history of unprofitable farming and had no arrangements to resume despite their stated intent).

  • 228 In re Lampe, 278 B.R. 205 (B.A.P. 10th Cir. 2002) (Kan. law) (farming remained debtors’ principal occupation, even though they were facing farm foreclosure and had taken outside jobs, where they continued to farm and would do so on other land even if foreclosure went through), aff’d, 331 F.3d 750 (10th Cir. 2003); In re Schley, 2011 WL 1344595 (Bankr. N.D. Iowa Apr. 7, 2011) (farm wife, who had full-time job as school principal, was engaged in farming when she operated farm equipment, kept the books, and dealt with the bank, suppliers, and so forth, so could claim state law exemption in farm equipment); In re Miller, 370 B.R. 914 (Bankr. D. Minn. 2007) (farm wife who worked full-time off-farm was engaged in farming—and therefore entitled to Minnesota exemption for “farm machines and implements used in farming”—where she kept farm books, delivered meals to field, ran errands, drove tractor, and sometimes worked in fields); In re Thompson, 311 B.R. 822 (Bankr. D. Kan. 2004) (allowing tools-of-trade exemption for farm equipment where husband worked at least forty hours on farm, in addition to full-time off-farm employment, and wife, also employed off-farm, devoted “considerable energy and personal resources” to farming; intention to make a profit must be shown, but expectation need not be reasonable); In re Kieffer, 279 B.R. 290 (Bankr. D. Kan. 2002) (allowing husband and wife to stack their tools-of-trade exemptions for farm equipment where wife shared work on farm in addition to her off-farm employment, couple made business decisions together, and wife had signed notes for purchase of farm equipment); In re Larson, 260 B.R. 174 (Bankr. D. Colo. 2001) (debtors were “engaged in agriculture as principal occupation” even though they were working in trucking business in attempt to save unprofitable family farm; husband and wife could each stack an agricultural exemption with a tools-of-trade exemption for farm implements and livestock; note that statute has since been amended to prohibit stacking of agriculture and tools-of-trade exemptions). But cf. In re Matthews, 449 B.R. 833 (Bankr. M.D. Ga. 2011) (wife who worked in garden and picked pecans not engaged in farming; denying Georgia tools-of-trade exemption for tractor that she never drove).

  • 229 Devine v. Devine, 2005 WL 1926038 (Bankr. N.D. Iowa Aug. 5, 2005) (debtors who were living and working off farm could exempt farming equipment where intent to return to farming sufficiently shown); In re Thompson, 311 B.R. 822 (Bankr. D. Kan. 2004) (farmers who raised game birds sold entire stock “to make ends meet,” but intended to resume as soon as they could raise money; equipment was exempt as tools of trade); In re Lund, 2003 WL 21673545 (Bankr. N.D. Iowa July 14, 2003) (farm equipment qualifies for federal tools-of-trade exemption even though couple who had farmed for decades did not plant crop because bank cut off credit; factors include intensity of past farming and sincerity and reasonableness of intent to resume; that profits are “speculative” is not fatal). But cf. In re Skillen, 2009 WL 4823802 (Bankr. N.D. Iowa Dec. 14, 2009) (former farmers failed to show intent to return; statement of intent must be bolstered by reasonable prospects and objective fact; here, no showing of affirmative steps to resume farming); In re Hintzman, 2007 WL 80964 (Bankr. D. Minn. Jan. 8, 2007) (Minnesota exemption for farm equipment, available to debtor engaged principally in farming, not available where intent to return not shown; four years of unprofitable farming and no arrangements to resume; simple statement of intent not enough); In re Mausser, 225 B.R. 667 (Bankr. N.D. Iowa 1998) (in order to claim Iowa exemption for farm equipment, debtors not actively engaged in farming must establish objective facts that show reasonable prospects of resuming, not just subjective intent; not shown here).