What are the Bankruptcy Exemptions in Arizona?

What are the Bankruptcy Exemptions in Arizona

What are the Bankruptcy Exemptions in Arizona?

If you are contemplating filing bankruptcy in Arizona and you have lived in the state for at least two years at the time of filing, you may not use federal bankruptcy exemptions. You are compelled to use Arizona’s bankruptcy exemption laws. Bankruptcy exemptions determine what property you are allowed to keep after you have filed Chapter 7 bankruptcy. Because the state of Arizona has opted out of the federal bankruptcy exemptions, this means that all residents who have lived in Arizona for two years or more at the time of their bankruptcy filing must use the state’s exemption laws. The only federal bankruptcy exemption that you can claim under Arizona law is exemptions for retirement accounts. Here we will explore the bankruptcy exemptions under Arizona law.

Arizona’s Homestead Exemption for Real Property

Currently, under Arizona’s laws, if you own your home, you can protect equity in the home up to $150,000 (this exemption amount is set to change on January 1, 2022). For those who are filing bankruptcy in Arizona and do not own a home but had to pay a security deposit to a landlord, they can protect up to $2000 of that deposit as exempt from bankruptcy.

Arizona’s Personal Property Exemptions for Bankruptcy

Personal Items that are Exempt

Arizona allows those who are filing bankruptcy in the state to double the exemption amount for personal property, like wedding rings, household goods, and vehicles. As long as a personal item is used for a personal, household or family purpose, you may protect the following personal items from bankruptcy, up to the amount that is stated (this amount is doubled for married couples filing bankruptcy in Arizona):

  • Clothing – combined market value of up to $500
  • Musical instruments – combined market value of up to $400
  • Library (includes books, manuals, personal documents, published materials) – combined market value up to $250
  • Horses, poultry and milk cows – combined market value up to $1000
  • One watch with a market value of $250
  • Engagement and wedding rings – combined market value of up to $2000
  • One motor vehicle – with equity up to $6000 (If you or a dependent has a physical disability, equity in the car up to $12,000 may be protected)
  • One typewriter, one bicycle, one computer, one sewing machine, one burial plot, one family Bible- combined value up to $2000
  • Prostheses that have been professionally prescribed, wheelchair, or motorized mobility device – no limit
  • Firearms – combined market value up to $2000
  • Household pets/domestic animals – no limit
Food, Fuel, Provisions That Are Exempt
  • Up to 6 months’ worth of food, fuel and provisions may be protected when you file for bankruptcy in Arizona
  • Household Goods and Furnishings That Are Exempt
  • You can protect up to $6000 in household goods and furnishings ($12,000 for married couple) including consumer electronic devices and household appliances
  • Other Miscellaneous Personal Property That Is Exempt

  • If you participate in a commercial activity, business or trade, you can protect the tools of that trade, including a website
  • If you teach in a college, university, or school, you can protect your library and philosophical/chemical accessories used for teaching
  • Money Exemptions in Arizona

    You are entitled to keep the following money benefits or proceeds when you file bankruptcy in Arizona:

    • Up to $300 in your bank account
    • A 529 College Savings Plan that you own or are a beneficiary under
    • Money received/to be received by a surviving spouse on a deceased spouse’s life, up to $20,000
    • Money received/to be received by a surviving child on a deceased parent/guardian’s life, up to $20,000
    • Child support and alimony received/to be received– no limit
    • Money or benefits received/to be received under an employer’s health, accident or disability insurance plan
    • Insurance benefits received/to be received from fire or property insurance for property that was damaged or destroyed
    • Annuity contract
    • Interest in an ERISA-qualified retirement plan
    • Public benefits including unemployment compensation, workers’ compensation and welfare assistance
    • Pensions (under certain conditions)

    If you are considering filing bankruptcy in Arizona, contact our Arizona bankruptcy lawyers today. We will help you protect the maximum amount of assets allowable by law.

    Similar Blog Posts

    Bankruptcy Exemptions in Arizona – Part Four

    To finish off the series on Arizona’s bankruptcy exemptions is a unique set of exemptions.…
    Facebook
    Twitter
    Follow by Email
    LINKEDIN