If you file for Chapter 7 or Chapter 13 bankruptcy in Tennessee, the Tennessee 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 Tennessee bankruptcy exemptions protect, whether you can use the federal exemptions in Tennessee, what happens to exemptions if you are married and filing jointly, and more.
You Cannot Use the Federal Bankruptcy Exemptions in Tennessee
Some states allow you to choose between using the state exemptions and a list of federal bankruptcy exemptions. In Tennessee, however, you do not have this choice; you must use the Tennessee bankruptcy exemptions.
Although you can’t use the federal exemptions in Tennessee, you may use any of the federal non-bankruptcy exemptions. 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 state exemptions; you don’t have to choose between the two lists.
Married Couples May Double the Tennessee Bankruptcy Exemptions
Unless otherwise stated, if you are married and filing a joint bankruptcy petition, you can double the amount of the Tennessee bankruptcy exemption if you both own the property. If only one spouse owns the property, then you cannot double the amount.
Common Tennessee Bankruptcy Exemptions
Below are some of the most commonly used bankruptcy exemptions. The statute citations, unless otherwise noted, are to the Tennessee Bankruptcy Code Annotated.
In Tennessee, you can exempt up to $5,000 of equity in your home. The exemption increases to $7,500 for joint owners and to $25,000 if you have at least one minor child who is a dependent.
If you are 62 or older, you can exempt up to $12,500 of equity in your home, $20,000 if you are married, and $25,000 if your spouse is also 62 or older. §26-2-301. (Get more details in The Tennessee Homestead Exemption.)
Bible, school books, family pictures and portraits. §26-2-104
Burial plot up to 1 acre. §26-2-305; §46-2-102
Health aids. §26-2-111(5)
Health savings accounts. §26-2-105
Personal injury recoveries to $7,500, wrongful death recoveries to $10,000 (but you are limited to $15,000 total for personal injury recoveries, wrongful death recoveries, and crime victims’compensation). §26-2-111(2)(B),(C)
Motor Vehicle Exemption
Tennessee doesn’t have a motor vehicle exemption. But you can use the $10,000 wildcard (discussed below) to exempt car equity.
Tools of the Trade
Implements, books, and tools of the trade up to $1,900. 26-2-111(4)
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 $1,245,475. (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)
ERISA-qualified benefits. §26-2-111(d)
Public employees. §8-36-11
State and local government employees. §26-2-105
Aid to the blind, aged, and disabled. §71-4-117, 1112; §71-2-216
Crime victims' compensation. §26-2-111(2)(A); 29-13-111
Local public assistance. §26-2-111(1)(A)
Relocation assistance payments. §13-11-115
Social Security. §26-2-111(1)(A)
Unemployment compensation. §26-2-111(1)(A)
Veteran’s benefits. §26-2-111(1)(B)
Workers' compensation. §50-6-223
Accident, health, or disability benefits (you must be resident of Tennessee). §26-2-110
Disability or illness benefits. §26-2-111(1)(C)
Fraternal society benefits. §56-25-1403
Life insurance or annuity. §56-7-203
Alimony or child support that is owed in the 30 days before the bankruptcy filing. §26-2-111(1)(E)
Educational scholarship trust funds and prepayment plans. §49-4-108; §49-7-822
In Tennessee, you can use the wildcard exemption to exempt up to $10,000 of any personal property. §26-2-103
Confirming the Tennessee Bankruptcy Exemptions
This list includes some of the more commonly used Tennessee bankruptcy exemptions. There may be others. In addition, Tennessee periodically updates its exemption amounts and sometimes adds new exemptions. To find the most current laws, visit the Tennessee Codes. 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 Tennessee bankruptcy attorney.