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Millionaires Abuse Florida 's Homestead Exemption Law

Bankruptcy is meant to provide hard working , responsible individuals with a fresh start when they find themselves faced with troubled times There are situations when we fall so far behind , that bankruptcy is the only solution , whereby a debtor declares that he or she cannot pay for the debts they have incurred . There are other times in which bankruptcy is abused , used as a means to simply avoid paying a debt , whether a person has

millions in assets or little to nothing

As was the case of OJ Simpson , who , in a sense , fraudulently abused the system , utilizing Florida 's homestead exemption law to dodge the million dollar debt he had acquired . We are all familiar with the over publicized murder trial for which Simpson was a defendant . Accused of brutally killing his wife and her friend , Simpson , whether guilty or not , was acquitted of the charges against him . Enraged , the family of his deceased ex wife d a civil suit against him in the state of California , asserting that he was responsible for her death . On February 11 , 1997 , a jury ed Simpson to pay thirty-three and a half million dollars in punitive damages to the plaintiffs (Reutter

Simpson , of course did not want to pay up . He felt as though he owed the family nothing , and even told the media that he would not work to pay off the money that they had been awarded (Cable News Network Bankruptcy then , was a perfect option . Simpson left behind his California home and fled to Florida , trading in his west coast estate for a multi million dollar Miami mansion . Then , from his new home on the east coast , Simpson d for bankruptcy , making use of Florida 's homestead exemption law , protecting his new mansion from being sold to pay off his enormous debt (Reutter

As explained by Todd Zywicki , Professor of law at George Mason University , the law in Florida , which is similar to those in Iowa Kansas , South Dakota , and Texas , allows debtors to keep their homes when declaring bankruptcy . Shockingly , the homestead exemption is unlimited meaning that whether a debtor 's home is worth mere pennies or billions it cannot be seized to pay off debt in a bankruptcy action (Zywicki This loophole worked quite well for Simpson , who to this day has not paid his ex wife 's family a cent of the money they were awarded by the state of California (Hannah

This unlimited homestead exemption is completely absurd , and has become a rather convenient means for celebrities to hold on to their millions even after declaring bankruptcy . Burt Reynolds kept ownership of his mansion when he d for a fresh start ' in the state of Florida walking away from over ten million dollars in debt (Reutter . Bowie Kuhn , former base ball commissioner , also made a joke of the exemption He bought a Florida mansion only two weeks before his New York...

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