Many individuals who struggle with debt avoid filing for bankruptcy because they fear to lose important possessions. In fact, you may be able to keep your car, home and other assets.
While some states rely on federal bankruptcy exemptions or allow individuals to choose between state and federal exemptions, Ohio mandates the use of state exemptions. Learn more about Ohio bankruptcy exemptions that allow you to keep certain types of property.
You can retain up to $145,425 in your primary residence if you are a single taxpayer and up to $290,850 if you file joint taxes as a married couple. This exemption amount applies only to the equity in your home, not the mortgage amount. For example, if your home is worth $200,000 and you owe $150,000 on your mortgage, you fall under the homestead exemption threshold and can keep the property if you remain current on the mortgage.
Wages and pensions
Individuals filing for bankruptcy can retain wages of 75% of their disposable weekly earnings or 30 times the federal minimum wage (whichever is greater). Exempt investments include retirement accounts and public pensions. Life insurance proceeds from a spouse are also exempt.
Personal property exemptions
Ohio allows a wide range of personal property exemptions in bankruptcy:
- A motor vehicle valued up to $4,000 in equity
- A burial plot
- Household goods, furniture and clothing valued up to $13,400
- Medical devices and health aids
- Compensation for lost future earnings in the case of disability
- Tuition credit
- Jewelry valued at up to $1,700
- Recovery for wrongful death of a person who supported you financially
- Up to $25,175 in recovery for a personal injury
- Tools of your trade worth up to $2,550
In Chapter 7 bankruptcy, the trustee will sell non-exempt property to repay creditors. With a Chapter 13 filing, you must remit the amount of your nonexempt property as part of your debt repayment plan.