Filing Bankruptcy in Vermont: Means Test, Exemptions and Courts

Vermont has one federal bankruptcy court district: the U.S. Bankruptcy Court for the District of Vermont (https://www.vtb.uscourts.gov/).

Median family income for Vermont: 1 person $72,461; 2 people $96,963; 3 people $114,075; 4 people $137,583; add $11,100 for each additional person beyond 4. These figures apply to bankruptcy cases filed on or after July 15, 2026.

A homestead (dwelling house, outbuildings, and the land used with them) owned and used or kept by the person as a homestead is exempt up to $125,000.00 in value, together with its rents, issues, profits, and products. The statute sets no acreage limit.

The debtor's interest in one or more motor vehicles is exempt up to $2,500.00 in aggregate value. Unused vehicle exemption can be added to the wildcard (see wildcard).

The debtor's interest in any property up to $400.00 in value, plus up to $7,000.00 of any unused amount of the exemptions for motor vehicles, tools of the trade, jewelry, household goods, and growing crops.

Exempt: the debtor's interest in self-directed retirement accounts, including pensions, annuity proceeds and payments, IRAs, Keogh plans, SEP plans, and other plans qualified under Internal Revenue Code sections 401, 403, 408, 408A, or 457. Traditional IRAs and similar plans are exempt only to the extent contributions were tax-deductible or excludable when made (plus earnings and growth on them); a Roth IRA is exempt to the extent contributions did not exceed federal limits (plus earnings and growth). Contributions to a self-directed plan or account made less than one calendar year before a bankruptcy filing are not exempt. Payments under a pension, annuity, profit-sharing, stock bonus, or similar plan on account of death, disability, illness, retirement, or termination are also exempt to the extent reasonably necessary for support. For child-support attachment by the Office of Child Support, the retirement exemption is capped at $5,000.00.

Vermont's personal property exemption list (12 V.S.A. § 2740) has no separate item for earned but unpaid wages. Vermont's wage-protection statute for trustee process (garnishment) exempts the greater of 75 percent of weekly disposable earnings or 30 times the federal minimum hourly wage; for a debt from a consumer credit transaction, the greater of 85 percent or 40 times the federal minimum hourly wage; or more if the court finds the debtor's reasonable weekly expenses for self and dependents are higher. Earnings cannot be garnished at all from a debtor who received assistance from the Department for Children and Families or the Department of Vermont Health Access in the two months before the hearing.

The U.S. Bankruptcy Court for the District of Vermont has a "Filing Without an Attorney (pro se filing)" page that points to the national U.S. Courts information on filing without an attorney, and a "Pro Se Information for Debtors" page offering an information packet (the Vermont Pro Se Guide, April 2023) for debtors filing without a lawyer. The court's debtor pages also link to credit counseling and debtor education information, Debtor Electronic Bankruptcy Noticing, a notice for customers paying by check, information on discharging student loan debt, and Vermont Law Help (sponsored by Legal Services of Vermont and Vermont Legal Aid).

District of Vermont (the state's only bankruptcy district): under Vt. LBR 2016-2(a), a chapter 13 debtor's attorney's fees are presumed reasonable up to the amounts in Vt. LB Appendix XI. The posted Appendix XI (02/2022) states that as of February 1, 2022 the presumed reasonable fee is: up to $2,675 for a simple chapter 13 case (e.g., plan pays only unsecured claims and attorney's fees); up to $3,750 where the debtor pays ongoing mortgage payments directly (up to $2,900 pre-confirmation plus up to $850 post-confirmation); and up to $4,600 in a Conduit Mortgage Payments case (up to $3,950 pre-confirmation plus up to $650 post-confirmation). It also sets presumed reasonable fees for routine motions (e.g., up to $750 for a motion to modify a confirmed plan). Appendix XI provides that, unless the court orders otherwise, each amount automatically increases every February 1 by the change in the CPI-U, rounded to the nearest $25.