If you file for Chapter 7 bankruptcy in Louisiana, you can protect some or all of your property with Louisiana’s bankruptcy exemptions. The bankruptcy exemptions in Louisiana also play a role in Chapter 13 bankruptcy. Read on to learn about what property is covered by Louisiana’s bankruptcy exemptions.
For a general overview of bankruptcy exemptions, how they work, and which ones you can use, visit the Bankruptcy Exemption topic page.
Louisiana Requires Debtors to Use State Exemptions
Louisiana is an “opt out” state, meaning you are not permitted to use the federal bankruptcy exemptions when you file a bankruptcy in Louisiana. This means that Louisiana bankruptcy filers in may only exempt property using the Louisiana state exemptions.
Married Couples May Double Louisiana Exemptions
Married couples filing a joint bankruptcy in Louisiana may claim double the exemption amounts. This means that each spouse may claim the full exemption amount for any property in which the spouse has ownership interest. For example, if both spouses own household goods and they file jointly, they can double the amount of their personal property exemptions in order to protect the property’s value.
Common Louisiana Exemptions
Here are some of the most common exemptions available under Louisiana law. Unless otherwise noted, all references are to the Louisiana Revised Statutes Annotated.
Homestead or Residential Property
Up to $35,000 in equity in the home in which you live and the land on which it sits. The Louisiana homestead exemption is limited to five acres if it’s located in a town or city or up to 200 acres if not located in a town or city. Spouses may not double the Louisiana homestead exemption. For obligations arising as a direct result of a catastrophic or terminal illness or injury, you may exempt the full value of the home (based on home value in the one year prior). If you are the spouse or child of the owner and the owner is deceased, or if you were given the home by means of a divorce decree, you may use the homestead exemption. La. Rev. Stat. Ann. § 20:1
For more details about how the homestead exemption works in Louisiana, see The Louisiana Homestead Exemption.
Insurance proceeds for exempt property damaged by a natural disaster. La. Rev. Stat. Ann. § 13:3881
To $7,500 of equity (based on NADA value) in one motor vehicle used by you and your family. You may also exempt up to $7,500 of equity in one motor vehicle which is modified or fitted to assist you or a family member with a physical disability. La. Rev. Stat. Ann. § 13:3881
To learn more about how to exempt your motor vehicle under Louisiana law, see The Louisiana Motor Vehicle Exemption in Bankruptcy.
The household goods and furnishings, appliances, clothing, family portraits, arms and military accouterments, musical instruments, poultry, fowl, one cow, dogs, cats, other household pets, and wedding or engagement rings up to $5,000 in value. La. Rev. Stat. Ann. § 13:3881
The money you receive from the Federal Earned Income Tax Credit is exempt. La. Rev. Stat. Ann. § 13:3881
Pension, Retirement, and Life Insurance Benefits
All qualified pensions, tax-deferred arrangements, annuity contracts, and proceeds of and payments under tax-deferred arrangements and annuity contracts. La. Rev. Stat. Ann. § 13:3881
75% of disposable earnings or 30 times the federal minimum wage, whichever is greater. La. Rev. Stat. Ann. § 13:3881
Tools of the Trade
Tools, instruments, books, one utility trailer, and one firearm with a value up to $500. La. Rev. Stat. Ann. § 13:3881
Confirming the Status of Louisiana’s Bankruptcy Exemptions
Louisiana’s exemption amounts are adjusted periodically. To make sure you have the most recent figures, be sure to check for any updates at the website of the Louisiana Legislature at www.legis.state.la.us.
To learn more about filing for bankruptcy in Louisiana, see Louisiana Bankruptcy Information.