Bankruptcy Exemptions in Vermont
What property you can keep in bankruptcy in Vermont: homestead, vehicle, wildcard and retirement exemptions, and whether you can choose the federal exemptions.
Short answer: 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. 27 V.S.A. § 101
| Homestead exemption | 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. Source: 27 V.S.A. § 101 |
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| Car exemption | 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). Source: 12 V.S.A. § 2740(1) |
| Wildcard exemption | 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. Source: 12 V.S.A. § 2740(7) |
| Retirement accounts | 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. Source: 12 V.S.A. § 2740(16), (19)(J) |
| Wages | 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. Section 3170 is written for trustee process against earnings; whether it applies to earned but unpaid wages claimed as exempt in a bankruptcy case is not stated in the statute. Source: 12 V.S.A. § 3170 |
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FAQ
How much home equity is protected in bankruptcy in Vermont?
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.
Can I keep my car in bankruptcy in Vermont?
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).
Does Vermont have a wildcard exemption?
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.
Are retirement accounts protected in bankruptcy in Vermont?
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.
Are wages protected in bankruptcy in Vermont?
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.
General legal information, not legal advice. Laws change and local rules can differ; check the linked official source or talk to a lawyer about your situation.