Kentucky Bankruptcy Exemptions

Persons who file for bankruptcy in the State of Kentucky are not eligible for federal bankruptcy exemptions. Kentucky residents can use the exemptions described in state law. Any property that falls into one of the exemption categories below, up to the dollar amount listed, can be exempt in the bankruptcy process. You will be able to keep this exempted property after you file bankruptcy. There are certain debts, which you will not be able to erase in bankruptcy.

For instance, if the property is secured by a loan and you are current on the payments, the equity is covered by your exemptions. If you choose to keep making payments on the property, you generally can keep this property through the bankruptcy. The trustee may elect to liquidate the assets and distribute the assets if the equity is over the exempted amount.

Married couples filing jointly can 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.


Homestead: Real or personal property used as a family residence to $5,000; sale proceeds exempt

Insurance: Annuity contract proceeds to $350 per month, Cash value of life insurance if beneficiary is not the insured, Life insurance proceeds if policy prohibits use to pay creditors, Life insurance policy if beneficiary is a married woman, Group life insurance proceeds, Health or disability benefits, Fraternal benefit society benefits, Cooperative life or casualty insurance benefits

Personal Property: Burial plot to $5,000 in lieu of homestead, Motor vehicle to $2,500, Wrongful death recoveries for person you depended on needed for support, personal injury recoveries to $7,500 (not to include pain and suffering or pecuniary loss), Medical expenses paid and reparation benefits received under motor vehicle reparation law, Lost earnings payments needed for support, Health aids, Clothing, jewelry, furnishings, and articles of adornment to $3,000 total, $1,000 of any property

Miscellaneous: Alimony, child support needed for support, Property of business partnership

Public Benefits: Aid to blind, aged, disabled, public assistance, Unemployment compensation, Workers’ compensation, Cooperative life or casualty benefits, Crime victims’ compensation

Pensions: Firefighters, Police Officers, State employees, Teachers, Urban county government employees, Tax-exempt retirement accounts, including 401(k)s, 403(b)s, profit sharing, and money purchase plans, SEP and SIMPLE IRAs, and defined purchase plans. Other pensions needed for support, including IRAs

Wages: Minimum of 75% of earned but unpaid wages; bankruptcy judge may authorize more for low-income debtors

Wildcard: $1,000 of any property

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