The Pennsylvania Homestead Exemption

Most people want to know whether they can keep valuable property before filing for bankruptcy—especially a home. If you qualify to use the federal homestead exemption, you can protect some or all of the equity in your house. In this article, we explain:

• why you'll choose between federal and Pennsylvania state bankruptcy exemptions
• how much the federal homestead exemption will cover when filing in Pennsylvania, and
• how to apply it in your bankruptcy case.

For more bankruptcy information, read How Bankruptcy Works in Pennsylvania. Not only will you find answers, but it includes helpful checklists and a link to an interactive bankruptcy quiz. Or, try the start-to-finish bankruptcy guide, What You Need to Know to File for Bankruptcy.

Homestead Exemption Available in a Pennsylvania Bankruptcy

Pennsylvania lets filers use either the federal exemption system or Pennsylvania's state exemption system. Even so, you'll have only one homestead exemption—the federal homestead exemption—because Pennsylvania doesn't offer a state homestead exemption. Also, be aware that you can't mix exemptions from both lists, so you'll want to select the system that will protect the most assets.

If you hold property as tenancy by entirety with your spouse: If one spouse files for bankruptcy—not both—the bankruptcy trustee might be prevented from using the property equity to pay off debts. However, this is a tricky area of law. Talk with a local bankruptcy attorney before filing to ensure that you don't lose valuable property.

Comparing Pennsylvania and Federal Exemptions

To help you make an informed choice, we've listed the federal homestead exemption amount below. We've also included links to more complete federal and state exemption lists so you'll have an easier time deciding which set will work best for you.

If you're married, keep in mind that spouses can double some exemption amounts, but not all. Find out about other filing considerations for spouses.

Timing Your Pennsylvania Bankruptcy

You can file for bankruptcy in Pennsylvania after living there for more than 180 days. However, you must live in Pennsylvania much longer before using Pennsylvania exemptions—at least 730 days before filing, to be exact. Otherwise, you'd use the previous state's exemptions.

But suppose you lived in multiple states during the two years before filing for bankruptcy. In that case, you'd use the exemptions of the state you lived in for most of the 180 days before the two-year period that immediately preceded your filing. (11 U.S.C. § 522(b)(3)(A).) Learn more about filing for bankruptcy after moving to a new state.

Claiming the Pennsylvania Bankruptcy Homestead Exemption

If you opt to use the federal homestead exemption, the homestead exemption is automatic—you don't have to file a homestead declaration with the recorder's office in order to claim the homestead exemption in bankruptcy. However, when completing your bankruptcy forms, you'll list your homestead exemption on Schedule C: The Property You Claim as Exempt. You can find out about other requirements you'll need to meet to avoid losing your home in Your Home in Chapter 7 or Your Home in Chapter 13.

Finding the Pennsylvania Bankruptcy Exemption Statutes

You'll find Pennsylvania statutes on the Pennsylvania General Assembly website. Learn about finding state statutes in Laws and Legal Research.

Need More Help?

You might not know this, but Nolo has been making the law easy for DIYers for over fifty years. If you have questions, use the links we've included throughout for more details. Otherwise, you'll find the answers to almost all of your bankruptcy questions at nolo.com/legal-encyclopedia/bankruptcy or by consulting with a local bankruptcy lawyer.

This overview cannot provide all of the information you'll need to file a bankruptcy case. For more detailed information, consider buying a self-help book such as How to File Chapter 7 Bankruptcy by Attorney Cara O'Neill and Albin Renauer J.D.

Updated July 16, 2021