What can you keep when you file for bankruptcy?

| Sep 25, 2019 | Chapter 7 Bankruptcy |

When you file for bankruptcy, especially Chapter 7, a court helps you get rid of your debt so you can start over. As part of that process, if you have any assets or possessions, a court may ask you to sell them to help pay off part of your debt. You may worry that you will have to give up all your possessions.

However, Ohio recognizes that there are certain possessions you may need to live and work. When you declare bankruptcy, you will not have to sell these items to pay your creditors.

What is exempt?

Many of your possessions stay exempt underneath a certain dollar limit. These limits go up regularly with the cost of living. Some of Ohio’s exemptions to bankruptcy in 2019 include:

  • Your house, with equity up to $145,425
  • Your car, with equity up to $4,000
  • Up to $500 in non-exempt cash
  • A household item worth up to $625
  • Multiple household items worth up to $13,400
  • Jewelry worth up to $1,700
  • Tools or books you need for your professional trade up to $2,550

Ohio also exempts many different types of income. Certain incomes like retirement, spousal or child support, and unemployment compensation stay exempt from bankruptcy proceedings.

Declaring bankruptcy does not mean giving up everything

When you declare Chapter 7 bankruptcy, you start over financially. But starting over does not mean losing the tools to rise again. When you declare bankruptcy, Ohio laws make sure you still have the things you need to live and work. The court will not expect you to give up everything.