Last Updated on January 11, 2023 by James Gentile
Each state sets specific exemptions. There are also federal bankruptcy exemptions, but Arizona residents generally use the Arizona state exemptions. Exemptions are property or assets that are allowed to be kept after filing for bankruptcy. These are protected from creditor access. In this article, we will discuss bankruptcy exemptions in Arizona.
What Are the Bankruptcy Exemptions in Arizona?
Loan-based Assets
If you have an asset that is backed by a loan, you may elect to continue making payments on that property (such as a home or a car) as long as the lender agrees to the terms. However, the equity in that vehicle or home must be under the state’s exemptions. Equity is the value of an asset that’s paid back. For example, if you have a vehicle worth $7,000 and you have a current loan valued at $3,000 (you owe this much on loan), you have $4,000 worth of equity.
Other Assets and Bankruptcy Exemptions in Arizona
Homestead Exemption
This exemption applies to your home. It includes home, apartment, mobile home, or any other real estate you occupy. Your exemption in Arizona is $150,000. If you sell the property, the proceeds are exempt 180 days after the sale or until a new home is purchased, whichever occurs first.
This exemption applies to your home. It includes home, apartment, mobile home, or any other real estate you occupy. Your exemption in Arizona is $150,000. If you sell the property, the proceeds are exempt 180 days after the sale or until a new home is purchased, whichever occurs first.
You can have $6,000 worth of personal household items as part of the exemptions. This is doubled for husband and wife.
Also, you may have other items, including:
- A bank account with up to $300
- Bible, bike, sewing machine, pistol or shotgun, burial plot, typewriter, and rifle, valued at a combined $500
- Food and fuel for up to six months
- A vehicle – up to $6000 in equity, or, if you are disabled, up to $12,000 in equity
- Books up to $250 worth
- Clothing up to $500 worth
- Musical instrument up to $250
- Pets, horses, milk cows, and poultry up to $500
- Wedding and engagement rings valued at no more than $2,000
- Prostheses including wheelchair
Prepaid rent or security deposits are exempt to $2,000 in value or one and half times your current rental amount, whichever is lower. This is only available if you do not apply for the homestead exemption.
Insurance
If you have benefits from fraternal organizations, a group life insurance plan or proceeds, health insurance, disability benefits, accident benefits, life insurance with a cash value of only $1,000 per dependent, and life insurance proceeds of $20,000 beneficiary is a child or a spouse. Minor child earnings are all exempt from bankruptcy.
Others
IRAs, a board of regents member benefits, ERISA-qualified benefits, firefighters, police officers benefits, rangers, state employee benefits, unemployment compensation, welfare benefits, and worker’s compensation benefits are protected. Tools: items used to complete work-related tasks are exempt up to $5,000.
Tools
Items used to complete work-related tasks are exempt up to $5,000.If you are filing for bankruptcy, it is important to understand these and other Arizona bankruptcy exemptions and how they apply to your specific situation.
If you are filing for bankruptcy, it is important to understand these and other Arizona bankruptcy exemptions and how they apply to your specific situation. As always, consult a qualified attorney who can help you decide if bankruptcy is the right option for your financial situation. Please contact us today for your free consultation.
