Montana Bankruptcy Exemptions

You can keep some of your property in Chapter 7 bankruptcy with Montana's bankruptcy exemptions.

January 6, 2017

If you file for Chapter 7 bankruptcy in Montana, you can protect some or all of your property with Montana’s bankruptcy exemptions. The exemptions also play a role in a Chapter 13 case. Read on to learn about the  property  that you'll be able to protect in bankruptcy.

(For more information, check out our page on  bankruptcy  exemptions.)

Filers Must Use State Exemptions

If you file for bankruptcy in Montana, you'll use the state exemptions, not the federal bankruptcy scheme. However, you can use any of the applicable  federal non-bankruptcy exemptions. The federal non-bankruptcy exemptions protect property such as federal retirement accounts and veterans’ benefits.

Married Couples Can Double Montana Exemptions

Married couples who file a joint bankruptcy can each use the exemption amount and effectively double the amount of protectable property. The caveat is that each spouse must have an  ownership interest in the property. For example, if both spouses own a car and they file jointly, they'll be able to protect twice the equity in the car.

Montana’s Exemptions Apply Only In Bankruptcy

Montana is one of a few states in which the exemptions apply in bankruptcy only (you can’t use them to protect your property in other proceedings). Some courts have held such restrictions unconstitutional.

Common Montana Exemptions

Below are some of the most common Montana exemptions. All references are to the Montana Code Annotated (Mont. Code Ann.).

Homestead or Residential Property

The homestead exemption protects equity in your home. In Montana, you can exempt up to $250,000 of equity in a residence (on up to 320 farm acres, a quarter of city acreage, or one residential acre outside a municipality). You can also protect proceeds from insurance, condemnation, or the sale of a qualifying home for up to 18 months. (The funds lose the exempt status after the 18-month period expires.) You must file a homestead declaration before filing bankruptcy to qualify for the exemption. Mont. Code Ann. § § 70-32-104,  25-13-615

Insurance Benefits

Life insurance proceeds (other than to the insured).  Mont. Code Ann.   § 33-15-511

Medical, surgical, or hospital care benefits. Mont. Code Ann. § 25-13-608(1)(f)

Group life insurance proceeds. Mont. Code Ann. § 33-15-512

Hail insurance benefits (conditions apply). Mont. Code Ann. § 80-2-245

Fraternal group society benefits. Mont. Code Ann. § 33-7-522

Unmatured life insurance contracts. Mont. Code Ann. § 25-13-608(1)(k)

Annuity contracts (conditions apply). Mont. Code Ann. § 33-15-514

Motor Vehicle

In Montana, you can protect up to $2,500 of equity in one motor vehicle. Mont. Code Ann. § 25-13-609(2)

For instance, suppose that Jennifer owns a 2008 Honda Fit worth $10,000. She owes the dealer $9,000; thus, there is $1,000 of equity in her vehicle. She can protect the full value of her car with the vehicle exemption.

Personal Property

Furniture, appliances, animals, feed, and crops, musical instruments, books, firearms, sporting goods, jewelry, and clothing, up to $600 per item and $4,500 total. Mont. Code Ann. § 25-13-609(1)

Prescribed health aids. Mont. Code Ann. § 25-13-608(1)(a)

Burial plot. Mont. Code Ann. § 25-13-608(1)(h)

Cooperative association shares. Mont. Code Ann. § 35-15-404

Proceeds from insurance or the sale of exempt property (conditions apply). Mont. Code Ann. § 25-13-610(1)

Domestic Support

Alimony and child support. Mont. Code Ann. § 25-13-608(1)(g)

Pension, Retirement, and Other Benefits

Public employee retirement benefits. Mont. Code Ann. § 19-2-1004

Qualified benefits (conditions apply). Mont. Code Ann. § 25-13-608(1)(e)

Firefighters’ retirement benefits. Mont. Code Ann. § 19-18-612

Police officers’ retirement benefits. Mont. Code Ann. § 19-19-504

Teachers’ retirement benefits. Mont. Code Ann. § 19-20-706

University system employees’ retirement benefits. Mont. Code Ann. § 19-21-212

Public Benefits

Public assistance. Mont. Code Ann. § § 53-2-607, 25-13-608(1)(b)

Unemployment compensation. Mont. Code Ann. § § 31-2-106(2), 39-51-3105

Veterans’ benefits (not including support payments). Mont. Code Ann. § 25-13-608(1)(c)

Silicosis benefits. Mont. Code Ann. § 39-73-110

Crime victims’ compensation. Mont. Code Ann. § 53-9-129

Tools of the Trade

Tools and implements of your trade up to $3,000, including a  library. Mont. Code Ann. § 25-13-609(3)

Confirming Montana’s Bankruptcy Exemptions

Montana adjusts exemption amounts periodically. You can check for updates at the official website of the Montana Legislature.

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