Is Michigan Adjusting Its Bankruptcy Exemptions for Inflation in 2023?

 

The Federal Government adjusts Federal exemption amounts every three years. Does Michigan adjust exemption amounts?

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Michigan Bankruptcy Exemptions Inflation Adjustments 2023 

MCL Citation Original Value 2020 Value 2023 Value
600.5451 (1) ( c )
Appliances, utensils, books, furniture, & household goods — per item
$450 $625 $700
600.5451 (1) ( c )
Appliances, utensils, books, furniture, & household goods — TOTAL
$3,000 $4,050 $4,625
600.5451 (1) (d)
Church pew
$500 $700 $800
600.5451 (1) (e)
Crops, farm animals, and feed for the farm animals
$2,000 $2,700 $3,075
600.5451 (1) (f)
Household pets
$500 $700 $800
600.5451 (1) (g)
Motor Vehicle
$2,775 $3,725 $4,250
600.5451 (1) (h)
Computer & Accessories
$500 $700 $800
600.5451 (1) (I)
Tools of Trade
$2,000 $2,700 $3,075
600.5451 (1) (m)
Homestead — Regular
$30,000 $40,475 $46,125
600.5451 (1) (m)
Homestead — 65 or Older
$45,000 $60,725 $69,200
Each state has its own set of exemption laws, apart from the federal bankruptcy exemptions under § 522. 

Does Michigan Adjust Its State Exemptions for Inflation?

2023 INFLATION ADJUSTMENTS FOR BK-ONLY EXEMPTIONS: Under Michigan law, bankruptcy-only exemption amounts are adjusted for inflation on April 1, every three years (starting in 2005) by the Michigan Department of Treasury. These amounts have been adjusted, so the amounts listed in the statutes are not current.  The most recent adjustment was published January 25, 2023 and applies to bankruptcies filed on or after April 1, 2023. Michigan inflation-adjusted exemption amounts for 2023 can be found here or by going to www.michigan.gov/treasury and typing "bankruptcy exemptions" in the search box.

Revised Federal Bankruptcy Exemption Amounts As of April 1, 2022

Can I use the Federal Exemptions in Michigan?:

Yes. Michigan residents can use the Federal or State exemption systems.

Michigan has passed a special set of exemptions designed only to be used in bankruptcy cases (found in Section 600.5451). Although debtors can use the the exemptions in Michigan's "bankruptcy only" exemption statute, as well as ANY OTHER exemptions found in other Michigan statutes, such as exemptions for life insurance. (See In re Sasasak, 426 B.R. 680.)

The federal bankruptcy exemptions are revised every three years. The last change was in 2019 and now they are changing again in 2022. The next change will be in 2025.

Not all states allow their residents to use the Federal Bankruptcy Exemptions.

The following are the new Federal Bankruptcy exemption amounts, effective April 1:

Exemption: Amount
Homestead  - § 522(d)(1) $27,900
Motor Vehicle  - § 522(d)(2)    $4,450
Household Goods  - § 522(d)(3)
- Per Item Limit
- Aggregate Limit

   $700
 $14,875
Jewelry  - § 522(d)(4)    $1,875
Wild Card  - § 522(d)(5) 
- Any property
- Unused homestead under § 522(d)(1)
 
 $1,475
$13,950
Tools of the Trade -  § 522(d)(6)    $2,800
Unmatured Life Insurance - § 522(d)(8)  $14,875
Personal Injury Claims - § 522(d)(11)(D)  $27,900
 

Here's What Other States Do

Every state also has its own exemption laws. Some of these states revise them for inflation, just like the federal government. The table below shows what each state does.

Some states (Alabama, Arizona, Alaska, California. Maine, Maryland, Michigan, Minnesota, Montana, Ohio, and South Carolina) periodically adjust their statutory exemption limits for inflation.

See the table below for more details. 




Jurisdictional relevance: ST

There are versions of this article for each State.



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