March 31, 2017
If you file for Chapter 7 bankruptcy in Iowa, you can protect some or all of your property with Iowa’s bankruptcy exemptions. The bankruptcy exemptions in Iowa also play a role in determining the monthly amount of a Chapter 13 repayment plan. Read on to learn about what property is covered by Iowa’s bankruptcy exemptions.
For a general overview, see Bankruptcy Exemptions.
Like many states, Iowa has enacted legislation “opting out” of the federal bankruptcy exemptions. As a result, bankruptcy filers in Iowa are only permitted to exempt property using the state laws.
The amounts listed are for an individual bankruptcy filer. A married couple filing jointly can double the amounts. Here are some of the most common exemptions available under Iowa law:
Alimony, support and maintenance are exempt to the extent they are necessary for support. Iowa Code § 627.6(8)(d).
Burial lots and cemeteries are exempt up to one acre. Iowa Code § 627.6.
Liquor licenses are 100% exempt. Iowa Code Ann. 123.38.
Fraternal benefit society benefits are 100% exempt. Iowa Code §§ 512B.18, 633.333.
Homeowners may exempt an unlimited amount of value in one home or a one-unit apartment covered by the homestead exemption. Property cannot exceed one-half acre if located within a city or town, or forty acres if located elsewhere. Iowa Code §§ 561.2, 561.16, 499A.18
For more details about how the homestead exemption works in Iowa, see The Iowa Homestead Exemption.
Public employee’s group insurance benefits are 100% exempt. A debtor’s interest in a life insurance policy is exempt when the debtor’s spouse, child, or dependent is the beneficiary. Life insurance proceeds are exempt to an extent (conditions apply). Group insurance benefits are exemept. Iowa Code §§ 509.12, 509A.9, 511.37 and 627.6.
A debtor may exempt up to $7,000 in any motor vehicle. Iowa Code § 627.6.
To learn more, see The Iowa Motor Vehicle Exemption in Bankruptcy.
Benefits from employee pension systems are 100% exempt. Social security and other pensions are exempt to the extent necessary for support. Iowa Code §§ 97A.12, 97B.39, 294.10B, 410.11, 411.13, 627.6, 627.8.
A debtor may exempt the following personal property:
Iowa Code § 627.6.
Public assistance is 100% exempt (this includes earned income and child tax credits). Iowa Code §§ 239B.6, 627.6, and 627.19.
A debtor may exempt up to $10,000 of trade implements. Iowa Code § 627.6.
Unemployment compensation is 100% exempt. Iowa Code §§ 96.15 and 627.6.
Veterans’ benefits are 100% exempt. Iowa Code § 627.6.
Workers’ compensation is 100% exempt. Iowa Code § 627.13.
The greater of 75% of disposable earnings or 40 times the federal minimum wage. Iowa Code §§ 642.21, 537.5105. Additionally, Iowa has a complicated alternative method of computing wages--consult with an attorney.
Wages are not exempt from child spousal or child support. Iowa Code §§ 627.6, 627.11, 627.12, and 642.21.
Up to $1,000 of any personal property, including cash. Iowa Code § 627.6(14). (Learn more in The Iowa Wildcard Exemption in Bankruptcy.)
Iowa’s exemption amounts are adjusted periodically. To make sure you have the most recent figures, be sure to check for any updates at the Iowa Legislature website.