The Tennessee bankruptcy exemptions chart, see below, details the property you can exempt or protect from creditors when you file bankruptcy in Tennessee. You may exempt any property that falls into one of the exemptions categories below, up to the dollar amount listed. You will be able to kept this exempted property after you file bankruptcy. Please note that there are certain debts which you will not be able to erase in bankruptcy. (see Non-dischargeable Debts)
An exemption limit applies to any equity you have in the property. Equity is the difference between the value of the property and what is owed on the property. For example, a car valued at $5000 with a loan of $4500 has an equity value of only $500.
If the property is secured by a loan, such as a car or home, and you are current on the payments and the equity is covered by your exemptions, you may elect to keep making payments on the loan and keep this property through the bankruptcy. If all the equity is not covered by your exemptions the trustee may elect to liquidate this asset and distribute the proceeds. Generally, in this case, you would be entitled to the value of your exemption in the asset as a cash payment.
Bankruptcy law allows married couples filing jointly to each claim a full set of exemptions, unless otherwise noted.
To keep non-exempt property, a debtor must generally pay the trustee the value of the non-exempt property.
When you file bankruptcy in Tennessee you may also use certain federal exemptions in addition to your Tennessee exemptions.
ASSET | EXEMPTION DESCRIPTION | LAW SECTION |
Homestead | $5000; $7500 for joint owners Life estate 2-15 year lease Spouse or child of deceased owner may claim homestead exemption Property held as tenancy by the entirety may be exempt against debts owed by only one spouse | 26-2-301 26-2-302 26-2-303 26-2-301 In re Arango, 136 B.R. 740, aff’d, 992 F. 2d 611 (6th Cir. 1993) |
Insurance | Accident, health or disability benefits for resident and citizen of Tennessee Disability or illness benefits Fraternal benefit society benefits Homeowners’ insurance proceeds to $5000 Life insurance or annuity for spouse/children/dependent |
26-2-110 26-2-111(1) ( C) 56-25-1403 26-2-304 56-7-03 |
Miscellaneous | Alimony owed for 30 days before filing for bankruptcy Property of business partnership | 26-2-111(1) (E) 61-1-124 |
Pensions | ERISA-qualified benefits Public employees State & local government employees Teachers | 26-2-111(1) (D) 8-36-111 26-2-104 49-5-909 |
Personal Property | Bible, schoolbooks, pictures, portraits, clothing & storage containers Burial plot to 1 acre Health aids Lost earnings payments for you or person you depended on Personal injury recoveries to $7500 (not to include pain and suffering); wrongful death recoveries to $10,000 (you can’t exempt more than $15,000 total for personal injury, wrongful death & crime victims’ compensation) | 26-2-103 26-2-305, 46-2-102 26-2-111(5) 26-2-111(3) 26-2-111(2) (B) 26-2-111(2) ( C) |
Public Benefits | Aid to blind Aid to disabled Crime victims’ compensation to $5000 (see personal property) Local public assistance Old-age assistance Social security Unemployment compensation Veterans’ benefits Workers’ compensation | 71-4-117 71-4-1112 26-2-111(2) (A), 29-13-111 26-2-111(1) (A) 71-2-216 26-2-111(1) (A) 26-2-111(1) (A) 26-2-111(1) (B) 50-6-223 |
Tools of Trade | Implements, books & tools of trade to $1900 | 26-2-111(4) |
Wages | Minimum 75% of earned but unpaid wages, plus $2.50 per week per child; bankruptcy judge may authorize more for low-income debtors | 26-2-106 26-2-107 |
Wild Card | $4,000 of any personal property | 26-2-102 |
For more information on filing bankruptcy in Tennessee explore Tennessee Bankruptcy Law.
