Four Important Types Of Minnesota Bankruptcy Exemptions

“It’s my money!” – yes, we know that this is a difficult thing to go through. The money  that you spend to file a bankruptcy, though, can be among the best investments you’ve  ever made in anything. We know that a bankruptcy only tells a small part of the story  about your financial history, and we help to mitigate the impact of bankruptcies for our  clients.  

In the state of Minnesota and many other U.S. states, there’s actually a lot you can do to  mitigate your financial situation through bankruptcy. There are multiple bankruptcy  paths, some of which allow you to retain more assets. Some assets or income are  shielded from bankruptcy collections in specific ways. 

Here are some of common exemptions for bankruptcy in Minnesota. Homestead Exemption 

In some bankruptcy situations, filers can exempt $450,000 of equity in their homes, or  more under certain homestead exemptions. Many states have such exemptions based  on a detailed philosophy of residential real estate and the agricultural history of the  country.  

Professionals looking at the logistics of bankruptcy will review factors such as the  person’s equity in the real estate, length of residence or ownership, and more to figure  out what’s beneficial from their particular standpoint. 

Salary and Benefits 

Typically, filers can exempt up to $75,000 in retirement benefits. That might be part of a  pension plan or a self-directed IRA. It might be part of a 401(k) agreement with an  employer. There may also be an opportunity to exempt up to 75% of wages earned, but  not yet paid.  

The ability to shield some retirement income is an important part of how bankruptcy law  has been written in Minneapolis, Minnesota and elsewhere. 

Insurance Exemptions 

Some amounts of life insurance may be exempted from bankruptcy as well. Again, this  is a way to help cover families and beneficiaries from excessive financial stress and  impact during a bankruptcy proceeding.

Personal Possessions 

Some types of personal possession exemptions also apply. 

For instance, there’s a common benchmark in Minnesota of $5000 for a vehicle  exemption, but in some cases, the exempted amount can be much more. One of the best ways to understand the details of this state bankruptcy law process is to  sit down with a professional. The team at Moshier Law Office PLLC are skilled and  experienced in helping clients to conduct filing for bankruptcy within the state. We know  state law and understand the details of bankruptcy processes here. Let us help you to  plan for your financial future.