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:
You'll also learn how to apply the homestead exemption in your bankruptcy case. For more bankruptcy information, read How Bankruptcy Works in Pennsylvania.
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.
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.
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Federal Homestead Exemption |
Pennsylvania Homestead Exemption |
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Homestead amount |
$27,900 |
None. |
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Can spouses who file a joint bankruptcy double the exemption? |
$55,800 is available to spouses who co-own property. |
Not applicable. |
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Homestead exemption law |
11 U.S.C. § 522(d)(1) |
Not applicable. |
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Other information |
Amounts will adjust on April 1, 2025. |
Not applicable. |
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Compare other federal and state exemptions. |
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.
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 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.
You'll find Pennsylvania statutes on the Pennsylvania General Assembly website. Learn about finding state statutes in Laws and Legal Research.
Did you know Nolo has been making the law easy for over fifty years? It's true—and we want to make sure you find what you need. Below you'll find more articles explaining how bankruptcy works. And don't forget that our bankruptcy homepage is the best place to start if you have other questions!
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We wholeheartedly encourage research and learning, but online articles can't address all bankruptcy issues or the facts of your case. The best way to protect your assets in bankruptcy is by hiring a local bankruptcy lawyer.
Updated April 7, 2022