2025 Bankruptcy Exemption Limits Increase by 13%
There are periodic adjustments to the dollar limits for the exemptions contained in the Bankruptcy Code. Effective April 1, 2025, the 2025 adjustments to bankruptcy exemptions reflect a 13.2% increase in various dollar amounts. This means that debtors who file bankruptcy will be able to retain more assets than before.
Exemptions in Bankruptcy are limits to how much value a person in bankruptcy can retain in certain categories of assets without having those assets liquidated by a Trustee in a Chapter 7 Bankruptcy, or having to make a payment to creditors as part of a Chapter 13 Bankruptcy.
Key changes for 2025 include:
Homestead Exemption (11 U.S.C. § 522(d)(1)) – Increased from $27,900 to $31,575.
Motor Vehicle Exemption (11 U.S.C. § 522(d)(2)) – Increased from $4,450 to $5,025.
Household Goods Exemption (11 U.S.C. § 522(d)(3)) – Per item limit increased from $700 to $800, and the aggregate limit increased from $14,875 to $16,850
Jewelry Exemption (11 U.S.C. § 522(d)(4)) – Increased from $1,875 to $2,125.
Wildcard Exemption (11 U.S.C. § 522(d)(5)) – The standard amount increased from $1,475 to $1,675, and the unused homestead portion increased from $13,950 to $15,800.
Tools of the Trade (11 U.S.C. § 522(d)(6)) – Increased from $2,800 to $3,175.
Personal Injury Recovery Exemption (11 U.S.C. § 522(d)(11)(D)) – Increased from $27,900 to $31,575.
Disclaimer: This information is for general informational purposes only and does not constitute legal advice. Bankruptcy laws are complex and subject to change, and the application of these laws varies based on individual circumstances. You should not rely on this information as a substitute for consulting with a qualified bankruptcy attorney. If you are considering bankruptcy or have questions about how these changes may affect you, contact an experienced bankruptcy attorney for legal advice tailored to your situation.