Indiana Bankruptcy exemptions

If you are resident of the state of Indiana and have been declared as bankrupt under chapter 7, you are entitled to certain Indiana bankruptcy exemptions. However, Indiana is one of those states that do not allow the debtors to use federal bankruptcy exemptions in place of the state-specified exemptions. However, federal supplemental exemptions can be used. Following is a general list of exemptions that can be availed in the state of Indiana.


Under the wildcard category, you can get any tangible or real personal property up to a maximum value of $8000.


Wages that you have earned but are yet to be paid can be exempted up to thirty times the minimum hourly wage (as per federal standards) or 75% of disposable weekly earnings, whichever is higher. If your regular income is very low, the court may allow you to exempt more.

Tools Of Trade

Indiana bankruptcy exemptions in this category are available only for the members of the National Guard; they can get their uniforms, equipment, and arms exempted in full.

Public Benefits

Unemployment compensation benefits and worker’s compensation benefits are exemptible in full value. You can also get 100% exemption for Crime victims’ benefits, if any.

Personal Property

Medical care savings account deposits and spendthrift trusts are exemptible in full. Health aids can also be exempted but only up to the extent that has been professionally prescribed for either you or those family members that are dependent on you. Besides that, 100 exemptions are also available for any equity in an intangible personal property.


7 types of pension benefits are 100% safe as per Indiana bankruptcy exemptions, including sheriff pensions, firefighter pensions, private and public retirement benefits and contributions, police officer pensions, state teacher pensions, public employee pensions, and federal pension exemptions.


You can keep 100% of any property owned by a partnership business.


100% of various insurance benefits are safe, such as benefits from fraternal benefit society, mutual life and accident insurance proceeds, life insurance proceeds (if there is a clause in the policy contract that prohibits the use of the proceeds to pay off debts), group life insurance policy, and employer life insurance policy on employee.


Any personal or real property that are using as a residence can be exempted up to a maximum value of $15000 (in terms of equity, not in terms of the current sale price). If only one spouse has incurred the debt, the court may also allow you to get Indiana bankruptcy exemptions for any property held as tenancy by the entirety.

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One Response to “Indiana Bankruptcy exemptions”

  1. Macc says:

    Very well. Indiana State has restricted its residents to use federal bankruptcy exemptions; they have to go for either state specific exemptions or federal supplemental exemptions. If the person who is going to be bankrupt does not have a good income source he / she can get the exemptions in their unpaid wages. The Indiana residents can use wild card option also for any property up to a specific limit. Pensioners of some specific categories can get their pension fully exempted. Indiana does not allow any body to exempt their tools but only member of National Guard can get the exemptions regarding their tools like uniforms, arms etc. Property can be exempted fully which is in use by a partnership business. Insurance policies can also get exempted and if you have a policy which can not be used to pay off your debts such policy can be exempted fully. Property can also be exempted for a certain limit by using the Homestead option. Indiana State has its own rules to follow, if any person is going to file bankruptcy in this state, the rules should be very clear to them.

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