Indiana Bankruptcy Exemptions

Indiana's bankruptcy exemptions can help you keep property in Chapter 7 bankruptcy. Learn what property is exempted.

April 1, 2017

If you file for Chapter 7 bankruptcy in Indiana, you can protect some or all of your property with Indiana’s bankruptcy exemptions. The bankruptcy exemptions in Indiana also play a role in Chapter 13 bankruptcy. Read on to learn about what property is covered by Indiana’s bankruptcy exemptions.

You can find out more by reading Bankruptcy Exemptions.

Indiana Debtors Must Use State Exemptions

Bankruptcy filers in Indiana can use only the Indiana state exemptions. The federal bankruptcy exemptions aren't available in this state.

Married Couples Can Double Indiana Exemptions

Married couples who file together in Indiana (a joint bankruptcy) can “double” the exemption amount for any property in which each spouse has an ownership interest. For instance, if both spouses own the rights to a trademark (which is intangible property) and file jointly, they can double the amount of the intangible property exemption allowing them to keep a portion (albeit small) of their rights.

Common Indiana Exemptions

Here are some of the most common exemptions available under Indiana law:

Homestead or Residential Property

The homestead exemption protects a certain amount of equity in your home or principal residence. A debtor is allowed to exempt up to $19,300 in a residence (or personal property). In addition, any interest that debtor has in a real estate held as a tenant by the entirety is exempt (unless both owners are bankrupt). Ind. Code §34-55-10-2(c)(1); 11 USC § 522(b)(3)(B).

For more details about how the homestead exemption works in Indiana, see The Indiana Homestead Exemption.

Insurance Benefits

All fraternal benefit society benefits are 100% exempt. Ind. Code § 27-11-6-3.

Life insurance policies that name the insured spouse, children, dependent relatives, or any creditor as a beneficiary and the proceeds of such policies are exempt from claims against the insured and the insured’s spouse; life insurance, mutual life, and accident insurance proceeds, including group policies, are exempt.

Ind. Code §§ 27-1-12-14; 27-1-12-29, 27-2-5-1; 27-8-3-23.

Motor Vehicles

Indiana does not have a specific motor vehicle exemption, but you can use Indiana's wildcard exemption to protect equity in your car, truck, van, or other vehicle (more below).

To learn more about exempting your motor vehicle under Indiana law, read The Indiana Motor Vehicle Exemption in Bankruptcy.

Partnership Property

Indiana has adopted the provision of the Uniform Partnership Act that exempts a partner’s interest in specific partnership property. Ind. Code § 23-4-1-25.

Pension and Retirement Benefits

Certain pension benefits for public employees are exempt. Ind. Code § 5-10.3-8-9. Benefit plans for legislators and retirement benefits for teachers are also exempt. Ind. Code §§ 2-3.5-4-11; 2-3.5-5-9; 5-10.3-8-9; 5-10.4-5-14.

Pension fund for firefighters and police. Ind. Code §§ 36-8-7.5-19; 36-8-7.5-22.

Personal Property

You may exempt the following personal property:

  • intangible personal property up to $400. Ind. Code § 34-55-10-2.
  • all health aids. Ind. Code § 34-55-10-2.
  • any interest in a qualified retirement plan. Ind. Code § 34-55-10-2.
  • a debtor’s interest in a refund or earned income credit for exempt bankruptcy property. Ind. Code § 34-55-10-2.
  • education savings account (529 and Coverdell) contributions made more than 2 years prior to filing; contributions made more than 1 but less than 2 years prior to filing to $5,000; no exemption for contributions made less than 1 year prior to filing. Ind. Code § 34-55-10-2(c )(9), (10).
  • earned income tax credit (but not federal child tax credit). Ind. Code Ann. § 34-55-10-2(c)(11).
  • money in medical care savings account or health savings account. Ind. Code § 34-55-10-2(c)(7), (8).
  • a spendthrift trust. Ind. Code § 30-4-3-2.
  • military uniforms, equipment, and guns. Ind. Code § 10-16-10-1.

Unemployment Compensation

Unemployment compensation benefits are 100% exempt until they are actually received by the debtor. Ind. Code § 22-4-33-3.

Workers’ Compensation

All workers’ compensation is 100% exempt except for child support claims. Ind. Code § 22-3-2-17.

Wildcard

Any nonresidential real estate or tangible property up to $10,250. Ind. Code § 34-55-10-2. (Learn more in The Indiana Wildcard Exemption in Bankruptcy.)

Confirming the Status of Indiana’s Bankruptcy Exemptions

Indiana’s exemption amounts are adjusted periodically. To make sure you have the most recent figures, be sure to check for any updates at the official website of the Indiana Code.

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