If you file for Chapter 7 bankruptcy in Minnesota, you can protect some or all of your property with Minnesota’s bankruptcy exemptions. The bankruptcy exemptions in Minnesota also play a role in Chapter 13 bankruptcy. Read on to learn about what property is covered by Minnesota’s bankruptcy exemptions.
For a general overview of bankruptcy exemptions, visit the Bankruptcy Exemption topic page.
Minnesota Allows Debtors to Choose Between State and Federal Exemptions
Minnesota is one of the few states that allow debtors to choose between state and federal bankruptcy exemptions. This means that bankruptcy filers may examine both sets of exemptions and elect the exemptions that better protect their assets.
Common Minnesota Exemptions
Here are some of the most common exemptions available under Minnesota law.
The homestead exemption protects a certain amount of equity in your house and the land upon which it sits, as long as you reside in the home. You may claim the homestead exemption regardless of whether the deed to your home is in your name or your spouse’s name. The homestead exemption also allows you to protect insurance proceeds for damage to your home or proceeds from the sale of your home for up to one year after the sale, up to the maximum amount of the homestead exemption. The Minnesota homestead exemption protects up to $390,000 of equity in your home and land or up to $975,000 of equity if your land is used for agricultural purposes. M.S. §510.2, subd.1.
The Minnesota exemption protects up to 160 acres of land, and you may not double the homestead exemption. Minnesota law also protects the full value of a manufactured home, if you live in it. M.S. §550.37, subd. 12.
For more details about the homestead exemption in Minnesota, see The Minnesota Homestead Exemption.
Pension and Retirement Benefits
Pensions, profit sharing plans, annuities, IRAs, or similar plans on account of illness, disability, death, age or length of service, up to a present value of $30,000. Additional value is protected to the extent reasonable necessary for your support and the support of your spouse and dependents. M.S. §550.37, subd. 24.
You may exempt up to $4,600 in one motor vehicle. M.S. §550.37, subd 12a
If the motor vehicle has been modified at the cost of at least $3,450 to accommodate a disabled person, you may exempt up to $46,000 in the vehicle.
To learn more about the Minnesota Motor Vehicle exemption, visit The Minnesota Motor Vehicle Exemption in Bankruptcy.
You may exempt the following personal property:
- clothing, one watch, utensils and food, appliances, furniture, jewelry, radio, and television, up to $10,350
- wedding rings, up to $2,817.50
- tools of your trade or business, farm implements, livestock, produce, or crops up to $11,500, and
- burial plot or church pew or seat.
Insurance proceeds from the death or a spouse or parent, up to $46,000, plus an additional $11,500 for each dependent of the surviving spouse or child.
Insurance proceeds from loss of or damage to exempt property.
Personal injury or wrongful death recovery for injury to yourself or your relative.
Assistance & Benefits
100% of public assistance benefits. M.S. §550.37, subd. 14
Unemployment benefits. M.S. §268.192, subd. 2
Worker’s compensation benefits. M.S. §176.175
Veteran’s benefits. M.S. §550.38
Minnesota law protects up to 75% of your gross earnings, or 40 times the federal minimum hourly wage per week (whichever is greater). M.S. §571.922, 550.37, subd. 13
For more information about wage garnishment in Minnesota, check out our article on Minnesota Wage Garnishment Law.
Confirming the Status of Minnesota’s Bankruptcy Exemptions
Minnesota’s exemption amounts are adjusted in even numbered years, as long as the amounts have changed at least 10%. To make sure you have the most recent figures, be sure to check for any updates at the official website of the Minnesota Legislature at www.leg.state.mn.us. The Minnesota Department of Banking & Finance, Division of Banking and Finance posts updated exemption amounts on its website at http://mn.gov/commerce/banking-and-finance.
For additional information on how to research and find the latest exemption amounts, see our Legal Research Center.