Michigan Bankruptcy Exemptions

Every state has passed laws that allow you to protect certain types of assets when you file bankruptcy. These assets include your home, car, IRAs, clothing, tools, pensions, etc. The State of Michigan also allows some federal exemptions. You can use these exemptions in conjunction or in place of state exemptions. A Michigan bankruptcy attorney would be able to advise you on which exemptions are best for your individual case.

Under Michigan law, the bankruptcy exemption amounts are adjusted every three years for inflation by the Michigan Department of Treasury.

There are some limits on certain exemptions such as equity that you have in a home or in a vehicle. The difference between the cost of the item and the amount owed on the item is the definition of equity. If the item, such as home or vehicle, is secured by a loan and payments are made on time, the equity is protected by your exemptions. A debtor must generally pay the trustee the value of the non-exempt property to keep the property. If you choose to keep the property, continual timely payments ensure that the property is protected through the bankruptcy.


Homestead: Real property to $31,900 (including condo) $47,825, if over 65 or disabled; Property cannot exceed one lot in village, city, town or 40 acres elsewhere; spouse and children of deceased owner may claim homestead exemption, Property held as tenancy by the entity may be exempt against debts owed by only one spouse

Pensions: Traditional and ROTH IRAs to $1,095,000 per person, Tax-exempt retirement accounts, including 401(k)s, 403(b)s, profit sharing and money purchase plans, SEP and SIMPLE IRAsand defined-benefit plans. ERISA-qualified benefits, except contributions within last 120 days, Fire fighters, Police officers, Judges, Probate judges, State employees, Legislators, Public school employees, IRAs and ROTH IRAs, except contributions within last 120 days

Insurance: Life insurance, Fraternal benefit society benefits, Disability, health benefits or mutual life, Employer sponsored life insurance trust fund or policy, endowment, life or annuity proceeds if clause prohibits proceeds from being used to pay beneficiary’s creditors

Personal Property: Professionally prescribed health aides, Computer and accessories to $525, Household pets to $525, appliances, utensils, furniture, books and household goods to $475 each, total $3,200, Burial plots, cemeteries, Building and loan association shares to $1,075 per value (in lieu of homestead), Church slip, pew, seat for entire family to $525, Personal clothing, Family pictures, Crops, animals and feed to $2,125, Food and fuel for family for 6 months, Motor vehicle to $2,950

Tools of Trade: Tools, implements, stock, team, motor vehicle, materials, apparatus, horse and harness to $1,000 total, Accoutrements and arms required

Wages: Head of household 60% of earned but unpaid wages ~ no less than $15 per week plus $2 per week per non-spouse dependent, if not head of household, 40% of earned but unpaid wages ~ no less than $10 per week

Miscellaneous: Property of business partnership

Wildcard: None

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