How Exemptions Work In New York
Exemptions in Chapter 7 and Chapter 13
You can protect property covered by an exemption regardless of whether you file for Chapter 7 or 13. But each chapter treats nonexempt property—things not covered by an exemption—differently.
- In Chapter 7 bankruptcy, the bankruptcy trustee sells nonexempt property and distributes the proceeds to creditors.
- In Chapter 13 bankruptcy, you keep everything you own. However your repayment plan must pay the value of the nonexempt property equity, or your disposable income, whichever is more.
The different approaches ensure that creditors receive the same amount regardless of the chapter filed.
Sources of Exemption Laws
Bankruptcy law is federal, but the laws regarding debts, collection, and property have traditionally resided in state law.
State Exemption Laws
Every state has its own set of exemptions laws.
These laws specify what kinds of property are "exempt from attachment" by a creditor in those states. These laws informally known as "exemption laws."
Sometimes they are collected under one section of a statute, but there are miscellaneous exemption provisions throughout the laws of New York.
Federal "Non-Bankruptcy" Exemptions
In addition to your state exemptions, various kinds of federal benefits, retirement accounts and other things are exempt under federal law, separate and apart from the Federal Bankruptcy Code — Title 11 of the United States Code (11 U.S.C.).
In all but 19 states, you must use these laws to protect your property, like your car and your house.
Federal Bankruptcy Exemptions Under Section 522 —
an Alternative System Available in 19 States
In 19 states you have the option of using the Federal Bankruptcy Exemptions found in (11 U.S.C. Section 522(d)) Alaska, Arkansas, Connecticut, District of Columbia, Hawaii, Kentucky, Massachusetts, Michigan, Minnesota, New Hampshire, New Jersey, New York, Oregon, Pennsylvania, Rhode Island, New Mexico, Texas, Vermont, Washington, Wisconsin.
Which exemptions system you should choose may depend on the particular facts of your situation, where you live, and what kinds of property you own.
We have categorized state and federal exemptions by category
Real Estate: Homestead
Doubling Exemptions for Joint Filers?
When a married couple files for bankruptcy jointly, federal law and the laws of many states allow them each to claim the full amount of an exemption.
(11 U.S.C. § 522.) Because a couple gets to claim twice the amount available to those who file alone, this practice is informally known as “doubling.”
Not all states allow doubling, however. (California, for example, does not.) And some states allow married couples to double only certain exemptions (for example, they might be able to double personal property exemptions but not the homestead exemption). In the charts that follow, we indicate exemptions that cannot be doubled (and states that don’t allow doubling at all). Unless you see a note stating that you cannot double, assume that you can.
How Exemptions Work in New York
The federal exemptions are available in New York, as are the state exemptions.
The main set of exemptions are found in the Debtor & Creditor Code § 282 and in the Civil Practice Law & Rules (C.P.L.R) §§ 5205, 5206.
How much home equity New York homeowners can protect depends on what county you live in, from $89,975, $149,975, or $179,950, depending on the county.
Other Listings of New York Exemptions
Does New York Adjust Exemptions for Inflation?
New York adjusts its exemption amounts for inflation every three years, starting in 2009, then 2012, 2015, 2018 and most recently on April 1, 2021. Click here for updated 2021 New York bankruptcy exemption amounts. The next change will be April 1, 2024