If you are considering filing for bankruptcy in the state of Ohio, you need to be aware of Ohio bankruptcy exemptions and how these may apply to your situation. After all, one of the main concerns people have when filing for bankruptcy is that they won’t be able to keep their belongings.
Are you wondering what assets are protected in bankruptcy in the state of Ohio? If so, check out this article, where we will be discussing Ohio bankruptcy exemptions that you may be able to take advantage of when you file.
How Do Bankruptcy Exemptions Work?
The purpose of bankruptcy in Ohio is to help residents get back on their feet by finding a solution for their debt. The purpose of bankruptcy is not to strip people of everything they own, which is how some people look at it.
Because of this, Ohio bankruptcy exemptions allow those filing for bankruptcy to keep things that they need to live. So, you can expect to qualify for exemptions that allow you to keep anything necessary to maintain a home or your employment.
The most common exemptions Ohio residents usually use are vehicle exemptions to protect their vehicles and home property. These are things considered necessary to live as you need a place to call home and most people require vehicles for their work.
However, keep in mind that exemptions are not there to help you protect unnecessary luxury items, which could include things like secondary properties or additional vehicles.
Key Bankruptcy Exemptions in Ohio
Now that you know a little bit more about what assets are protected in bankruptcy, what are the key exemptions you should be aware of? Here is a breakdown of the primary exemptions available in Ohio that may apply to your situation:
- Ohio homestead exemption applies to real or personal property that is used as a residence for you or your dependence, which can include a condominium, home, or mobile home. This protects up to $182,625 of home equity if you live in the property.
- Ohio motor vehicle exemption protects up to $5025 of equity in a single vehicle. However, if the vehicle is financed there are additional requirements you may need to meet.
- Ohio wild card exemption allows you the flexibility of covering any property of your choosing that is valued at $1675.
- Ohio pension and retirement exemptions protect the majority of tax-exempt pensions and retirement accounts.
Keep in mind that the exemptions are provided in Ohio or adjusted periodically, so you need to do your own research.
Other Types of Exemptions
Additionally, there are a variety of personal property exemptions that may or may not apply to your situation. This includes exemptions to protect certain amounts of household goods, jewelry, cash, tools of your trade, or spousal or child support.
There are some miscellaneous exemptions as well that include benevolent society death benefits, disability assistance payments, workers compensation benefits, and unemployment compensation benefits.
It is strongly recommended that you hire an Ohio bankruptcy attorney to help you better understand the exemptions you may qualify for. Because there are so many additional personal and miscellaneous exemptions, this can be crucial for understanding what you can and cannot protect when you file.
How Exemptions Differ in Chapter 7 vs. Chapter 13
There are two types of bankruptcy that are the most common in Ohio: Chapter 7 and Chapter 13 bankruptcy. Although being the most common options, these types of bankruptcy are very different from one another.
Chapter 7 is used to liquidate certain assets to pay off your creditors, while other debts will be discharged automatically. On the other hand, Chapter 13 is a repayment plan type of bankruptcy that requires you to pay back your creditors over the course of 3 to 5 years. There are specific income requirements for Chapter 7 as well, so if your income is too high, you will have to file for Chapter 13 as an alternative.
When it comes to exemptions, you can take advantage of any exemptions you qualify for when you file for Chapter 7 as a way of protecting as much property as possible. If you don’t qualify for Chapter 7 and file for Chapter 13, you will be able to keep all of your property but you will need to pay back your creditors the value of the property that is not covered by the Ohio exemptions.
Because of how these exemptions impact each type of bankruptcy, what you can and cannot keep or have to pay for will be very different depending on your situation.
FAQ Section
Will I lose my house if I file for bankruptcy?
Whether you file for Chapter 7 or Chapter 13 bankruptcy, it is very likely that you will be able to keep your house. The only time this would not apply is if you have excessive equity in your home or you have gotten significantly behind on your mortgage payments.
Can creditors take my car?
If you file for Chapter 7, it is possible that creditors will be able to repossess your vehicle. This applies to situations where the exemption does not cover the value of your vehicle, or you have more than one vehicle, resulting in it not being a necessity.
Do retirement accounts count as exempt?
The majority of retirement accounts in Ohio are considered to be exempt due to the fact that federal law allows those filing for bankruptcy to keep any tax-exempt retirement accounts.
How do exemptions protect personal property?
Depending on your financial situation and the personal property you own, you may be able to take advantage of personal property exemptions. These exemptions help to cover certain amounts of cash, household goods, burial lots, personal injury awards, jewelry, and tools of your trade.
Hire a Bankruptcy Attorney in Ohio
Before you take the step of filing for bankruptcy, one of the first things you need to do is to find a bankruptcy attorney. Richard P. Arthur, Attorney at Law, has extensive experience handling bankruptcy cases in Ohio and can help you find the exemptions that apply to you. To move forward with your bankruptcy case, contact us today at 937-254-3738 for a free consultation.