Commencement of a bankruptcy case creates an estate. The estate technically becomes the temporary legal owner of all the debtor's property. It consists of all legal or equitable interests of the debtor in property as of the commencement of the case, including property owned or held by another person if the debtor has an interest in the property. Generally speaking, the debtor's creditors are paid from nonexempt property of the estate.

In Washington State, as in other states, the commencement of a bankruptcy case results in the creation of a bankruptcy estate, which is a central concept in bankruptcy proceedings. This estate becomes the temporary legal owner of the debtor's assets and includes all legal or equitable interests of the debtor in property at the time the bankruptcy case is filed. The estate is not just limited to property directly in the debtor's name; it also encompasses property that others may hold but in which the debtor has an interest. The purpose of the estate is to gather the debtor's assets to allow for the orderly distribution to creditors, according to the priorities established under the Bankruptcy Code. Creditors are generally paid from the nonexempt assets in the estate. Exemptions are governed by both federal law and Washington state law, and debtors are allowed to choose between using federal exemptions or those provided by Washington state statutes. These exemptions are critical as they determine what property the debtor can keep for a fresh start post-bankruptcy.