Updated December 21, 2016
If you file for Chapter 7 or Chapter 13 bankruptcy in New Mexico, the New Mexico bankruptcy exemptions can help you keep some or all of your property (in Chapter 7) or reduce the total amount you must pay your unsecured creditors (in Chapter 13). (Learn how bankruptcy exemptions work in both Chapter 7 and Chapter 13 bankruptcy.)
Below you can learn what property the New Mexico bankruptcy exemptions protect, whether you can use the federal exemptions in New Mexico, what happens to exemptions if you are married and filing jointly, and more.
If you file for bankruptcy in New Mexico, you choose to use either of the following sets of bankruptcy exemptions: the New Mexico exemptions or the federal bankruptcy exemptions. You cannot mix and match between these sets, you must choose one and use only the exemptions within that scheme.
If you choose to use the New Mexico bankruptcy exemptions, however, you may also use any of the federal non-bankruptcy exemptions that apply in your situation. The federal non-bankruptcy exemptions protect property such as federal retirement accounts and veterans’ benefits. You can use both the federal non-bankruptcy exemptions and the New Mexico exemptions; you don’t have to choose between the two lists.
Unless otherwise stated, if you are married and filing a joint bankruptcy petition, you can double the amount of the New Mexico bankruptcy exemption if you both own the property. If only one spouse owns the property, then you cannot double the amount.
Below are some of the most commonly used bankruptcy exemptions. The statute citations, unless otherwise noted, are to the New Mexico Statutes Annotated.
In New Mexico, you can exempt up to $60,000 of equity in your home. §42-10-9 (Learn more about the New Mexico homestead exemption.)
In New Mexico you can exempt the types of personal property listed below. Unless otherwise stated, these exemptions are found in §42-10-1 and §42-10-2.
In New Mexico you can exempt the equity in a car, van, truck, SUV, motorcycle, or other motor vehicle up to $4,000. §42-10-1; §42-10-2 (Learn more about the New Mexico motor vehicle exemption.)
Tools used in your trade or profession, up to $1,500. §42-10-1; §42-10-2
75% of your disposable earnings or 40 times the federal minimum wage, whichever is more. The bankruptcy judge may exempt more wages for low-income debtors. §35-12-7
Tax exempt retirement accounts, including 401(k)s, 403(b)s, profit-sharing and money purchase plans, SEP and SIMPLE IRAs, and defined benefit plans. 11 U.S.C. § 522.
IRAS and Roth IRAs to $1,283, 025. (This amount is adjusted every three years. For the most recent figure, see Your Retirement Account in Bankruptcy.) 11 U.S.C. § 522(b)(3)(C)(n); 9-26-4(11).
Public employee retirement benefits. § § 10-11-135, -136
Judge and magistrate pensions. § § 10-12B-7, 10-12C-7
Educational retirement benefits. § 22-11-42
State police pension. § 29-4-10
Pensions or retirement benefits. §42-10-1; §42-10-2
Crime victims' compensation. §31-22-15
Public assistance. §27-2-21
Occupational disease disablement benefits. §52-3-37
Unemployment compensation. §51-3-37
Workers' compensation. §51-1-52
Benevolent association benefits to $5,000. § 42-10-4
Fraternal benefit society benefits. § 59A-44-18
Withdrawal or cash value of life, accident, health, or annuity benefits. §42-10-3
Life insurance proceeds. §42-10-5
Construction materials. §48-2-15
An ownership interest in an unincorporated association. §53-10-2
Particular business partnership property. §54-1-25
Interest in a spendthrift trust. § 42-9-4
In New Mexico, you can use the wildcard exemption to exempt:
This list includes some of the more commonly used New Mexico bankruptcy exemptions. There may be others. In addition, New Mexico periodically updates its exemption amounts and sometimes adds new exemptions. To find the most current laws, visit the New Mexico Compilation Commission. Be forewarned, however, that the exemptions are found in various parts of the code. To save time and ensure you’ve got the correct information, consider consulting with a New Mexico bankruptcy attorney.