How to File Bankruptcy in Minnesota

Learn about the information you'll need to file your Minnesota bankruptcy case.

December 11, 2017

If you’ve been thinking about filing a bankruptcy case to get a fresh financial start, you’ve probably discovered how difficult it can be to find the right information you need to prepare a bankruptcy case. This article will help you get started. You’ll learn about how you can protect your property when you file a bankruptcy case in Minnesota. You’ll also learn about Minnesota means testing information, credit counseling providers, where to find official bankruptcy forms, and where to file your case once your forms are complete.

(Not sure which bankruptcy chapter is best for you? Read What Is the Difference Between Chapter 7 and Chapter 13 Bankruptcy?)

Official Bankruptcy Forms

Before the Minnesota bankruptcy court discharges (forgives) your qualifying debt (not all debt is dischargeable), you’re required to disclose your financial situation on official bankruptcy forms that you can download from the U.S. Courts site.

When you’ve gathered the required information and provided details about your debts, assets, income, expenses, and recent property transfers on the forms, you’ll file your paperwork in your local bankruptcy court with either a filing fee or a request for fee waiver and a counseling completion certificate (more below).

Minnesota Bankruptcy Information

Federal law governs all bankruptcy filings, but Minnesota laws and procedures also play a part in the process. Here’s what you need to know.

Means Testing and Credit Counseling Information

You will find two types of Minnesota information on the website of the U.S. Trustee: means testing figures and approved credit counseling providers.

  • Means testing information: To file a Chapter 7 case, you must first determine if your income is too high for you to qualify. The “means test compares your family income to the median income for Minnesota. If you fall below the median, you qualify to file Chapter 7 bankruptcy. If your income is over the median, you might be able to pass the means test after deducting a list of standard expenses. A similar formula helps you to determine the amount of your Chapter 13 bankruptcy payment.
  • Education courses. Most individuals must take a counseling session with an approved credit counselor before filing a case. After you file, you’ll take a second course in debt management. On the U.S. Trustee website, you can find the approved providers by clicking “Credit Counseling & Debtor Education” and scrolling down to your bankruptcy district.

Minnesota Bankruptcy Court Locations

You’ll find court information on the District of Minnesota bankruptcy court website, including local rules, forms, and filing instructions (click on “Filing Without an Attorney).

The bankruptcy court has four divisions. The Fergus Falls Division isn’t staffed; however, the other divisional offices accept bankruptcy filing paperwork. To determine where to file your case, go to the court’s website and select “Court Information,” then “Court Locations.”

St. Paul Division

Minneapolis

Duluth

200 Warren E. Burger Federal Building and U.S. Courthouse

316 North Robert Street

St. Paul, MN 55101

(651) 848-1000

1-866-260-7337

U.S. Bankruptcy Court

301 U.S. Courthouse

300 South Fourth Street

Minneapolis, MN 55415

(612) 664-5200

1-866-260-7337

U.S. Bankruptcy Court

Gerald W. Heaney Federal Bldg.

515 West First Street

Duluth, MN 55802

(218) 529-3600

1-866-260-7337

Minnesota Bankruptcy Exemptions

When you file bankruptcy in Minnesota, the chances are good that you'll be able to protect (exempt) all your property. You could be required to turn over any property that doesn't appear on either the federal bankruptcy exemptions list or the list of exemptions passed by the Minnesota legislature, depending on your choice of exemption scheme.

The Chapter 7 trustee will sell any property that doesn't fit into an exemption category and distribute the proceeds to your creditors. If you file under Chapter 13 bankruptcy, you won't turn over nonexempt property, but you'll pay out its value as part of your three- to five-year repayment plan.

As a Minnesota resident, you can choose to use the federal bankruptcy exemption list or the Minnesota exemption list, depending on which offers you the most benefit. You cannot, however, mix and match individual exemptions from both lists. (Learn more about the federal exemptions in The Federal Bankruptcy Exemptions.)

Here is a list of commonly-used Minnesota exemptions:

  • Homestead. 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 (up to 160 acres); 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 (Minn. Stat. §§ 510.01, 510.02); the full value of a manufactured home, if you live in it (Minn. Stat. § 550.37, subd. 12).
  • Employee benefits. Up to $69,000 of employee present or future payments under a stock, bonus, pension, profit-sharing, individual retirement account, Roth IRA, individual retirement annuity, simplified employee pension, or similar plan or contract on account of illness, disability, death, age, or length of service, plus any additional amount reasonably needed for the filer's support (Minn. Stat. §550.37, subd. 24). (Learn how your retirement funds may also be protected under federal nonbankruptcy exemptions by reading Your Retirement Plan in Bankruptcy.)
  • Motor vehicle Up to $4,600 of equity in one motor vehicle. 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. (Minn. Stat. §550.37, subd. 12a)
  • Personal property. Clothing, one watch, utensils, food, appliances, furniture, 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; farm machines up to $13,000; teachers' books and equipment’; burial plot or church pew or seat. (Minn. Stat. §550.37 subds. 3-8)
  • Insurance benefits. Insurance proceeds from the death of a spouse or parent up to $46,000, plus an additional $11,500 for each dependent of the surviving spouse or child (Minn. Stat. § 550.37 subd. 10); insurance proceeds from loss of or damage to exempt property (Minn. Stat. § 550.37 subd. 9); personal injury or wrongful death recovery for injury to yourself or your relative (Minn. Stat. § 550.37 subd. 16); insurance policy up to $9,200 (Minn. Stat. § 550.37 subd. 23).
  • Assistance and benefits. 100% of public assistance benefits (Minn. Stat. § 550.37, subd. 14); unemployment benefits (Minn. Stat. § 268.192(2)); worker’s compensation benefits (Minn. Stat. § 176.175(2)); veteran’s benefits (Minn. Stat. § 550.38).
  • Wages. Up to 75% of your gross earnings, or 40 times the federal minimum hourly wage per week (whichever is greater). (Minn. Stat. § 550.37, subd. 13)

Confirming Minnesota’s Bankruptcy Exemptions

The Minnesota legislature adjusts exemption amounts in even-numbered years, as long as the amounts have changed at least 10%. To stay up to date, check the website of the Minnesota Legislature.

This overview provides some, but not all, of the necessary information needed in a bankruptcy case. For step-by-step filing instructions, consider purchasing a self-help book like How to File Chapter 7 Bankruptcy by Attorney Cara O’Neill and Albin Renauer J.D.

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