II. DO THE FEDERAL EXEMPTIONS OR STATE EXEMPTIONS APPLY? IF A STATE'S EXEMPTION LAW APPLIES, WHICH STATE'S?
Assuming that a state is an "opt-out" state as North Carolina, a debtor's "domicile" determines which exemption law to apply. Typically, for most debtors, the state in which the debtors live (and most likely) are filing their bankruptcy case will be the state's exemption law that will be applicable.
In determining the debtors' domicile, Section 522(b)(3) says that if a debtor was domiciled or living within the state for 730 days (2 years) prior to filing bankruptcy, then use that state's exemption laws. So, if the debtor has been living in North Carolina continuously for the two years immediately preceding the bankruptcy filing, North Carolina's exemption laws will apply to that bankruptcy case.
If a debtor has not lived in the state or a single state continuously for the 730-day (2-year) period, then use the exemptions for the state in which the debtor lived for 180 days immediately preceding the 730-day period before filing bankruptcy (or whichever state that the debtor lived in the longest during that 180-day period). 11 U.S.C. § 522(b)(3)(A).
For example, if a debtor seeks to file a bankruptcy case in North Carolina on July 1, 2022, but lived in Idaho from August 1, 2019, through August 31, 2020, the debtor had not lived in North Carolina for 730 days prior to filing bankruptcy on July 1, 2022 (almost, but not quite). So, where did the debtor live during the 180 days prior to the 730-day period? For the 180 days prior to the 730-day period, the debtor lived in Idaho. So, under Section 522(b)(3)(A), the Code dictates that Idaho exemptions would apply.
It is important to recall that "domicile" includes an intent to stay. Thus, if a debtor lived abroad during the 180 days or was in a location (or various locations) "without an intent to stay," then the debtor may not be domiciled in any state. An example could be where a debtor was working on a construction site for nine months while living in a motel or company housing. In that instance, the debtor did not have an "intent to stay," so the construction site location would not be the debtor's "domicile." The debtor would then use the federal exemptions under Section 522(d). In re Stephens, 402 B.R. 1, 6 ft. 16 (10th Cir. B.A.P. 2009) (non-citizen immigrant unable to claim state exemptions; federal exemptions apply).
But many states' exemptions statutes specify that the exemptions may only be claimed...
