Should I file an exemption declaration to protect my property from creditors?

In a few states, you must file an exemption declaration in order to use property exemptions. Learn more.

In a few states, to take advantage of the state exemptions, you must file an exemption declaration with the court clerk, county recorder, county clerk, or similar official. The declaration is a simple form in which you describe (or list) your property and give its location. In the states where you must file a declaration, you can sometimes file it even after you’ve been sued or you’ve filed for bankruptcy.

The court clerk, county recorder, or county clerk may be able to tell you whether the office has an exemption declaration form. If it does, fill it out and file it. If the clerk’s office doesn’t have a form, the clerk may be able to tell you whether people file exemption declarations there anyway. If they don’t, you probably don’t have to, either.

In most states, any real estate or personal property in which you reside, such as a mobile home or boat, will qualify for the homestead exemption. To take advantage of the homestead protection, you usually must be living in the homestead when you claim it as exempt in your declaration. (Find your state's homestead exemption amount on our Bankruptcy Exemption page.)

This puts your creditors on notice that they shouldn’t bother to go after that particular property. If they do, you need only point out your filed declaration for protection.

If you don’t have to file an exemption declaration, you still must act to take advantage of your state’s exemptions. If you file for bankruptcy, you must list all of the exemptions you claim on your bankruptcy forms. (Get comprehensive information about bankruptcy exemptions.) And if a judgment creditor goes after your exempt property, you must file a claim of exemption. (To learn how, see our Property Exemptions area.)

This is an excerpt from Nolo's Solve Your Money Troubles: Debt, Credit & Bankruptcy, by Margaret Reiter and Robin Leonard.

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