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Arizona Bankruptcy Exemptions

Many people are fearful of bankruptcy because they do not want to take a chance of losing their home, car or other property by filing bankruptcy. There are many stories that can be found about people who filed bankruptcy without a lawyer and lost property.

By hiring our Glendale bankruptcy attorney, you can be assured that we will be there to advise you about how we can help you protect your property when filing bankruptcy.

Below, you will see several of Arizona’s most important bankruptcy exemptions, which will show you how to protect your property in a bankruptcy. To see all of Arizona’s bankruptcy exemptions, click here. Also, keep in mind that you must have lived in Arizona for at least the past two full years before you are eligible for Arizona’s bankruptcy exemptions. If you lived in another state prior to the last two years, contact our Glendale bankruptcy lawyer for help on which state’s or federal exemptions you are qualified to use.


Everyone wants to keep their home. You have put a lot of time, work and money into your home and want to make sure you and your family have a roof overhead during these trying financial times. Arizona has a generous $150,000 homestead exemption:HOMESTEAD Interest in real property upon which debtor’s house sits, condominium or cooperative, mobile home, or mobile home in which debtor resides plus the land upon which the mobile home is located in the amount of $150,000. May not be doubled by husband and wife. A.R.S. § 33-1101

If you have more than $150,000 of equity in your home’s current value, make sure to see our Glendale bankruptcy attorney for advice. A bankruptcy trustee has the absolute power to sell your home if there is more equity than the homestead exemption can protect.Personal Property. Just as important as your home is your personal property. Everyone needs furniture, appliances, and the other essentials that make up our home. In Arizona, you have the option of doubling up on some exemptions if you are married. The personal property exemption allows for up to $6,000 per filer for personal property, which can be doubled to $12,000 for married couples.

Personal Property

Husband and wife may double all personal property exemptions Household furniture and furnishings, household goods, including consumer electronic devices, and household appliances personally used by the debtor or a dependent of a debtor and not otherwise specifically prescribed in this chapter in an amount not greater than $6,000 (total fair market value). A.R.S. § 33-1123


Most of the time, keeping a vehicle through your bankruptcy is extremely important. Vehicles are necessary for transportation to and from work and just about everything else. Arizona allows for you to exempt up to $6,000 per filer. This means a bankruptcy filer can protect one vehicle with up to $6,000 of equity, or, if married, this exemption may be doubled up to $12,000 on one car. A married couple with two cars can each claim a $6,000 exemption on each car. No more than two vehicles can be exempted.
Equity in one car not greater than $6,000. If debtor (or debtor’s dependent) is physically disabled, the fair market value of the motor vehicle must not be greater than $12,000. (Equity is the fair market value of the motor vehicle minus debt to secured creditor). A.R.S. § 33-1125(8)


Many people ask me about keeping their wedding rings. Good news! Arizona has an exemption for wedding rings. You can protect up to $2,000 per filer for the fair market value of your wedding ring. If you think your ring is worth more than $2,000, get an appraisal. Talk to our Glendale bankruptcy attorney for more advice about how to protect your wedding ring and other jewelry you may have.
All engagement and wedding rings with a total fair market value not greater than $2,000. A.R.S. § 33-1125(4)

Retirement Accounts/Pensions

Another important asset to protect through your bankruptcy is your retirement account. Retirement accounts consist of your 401k, IRA’s, pensions, and other types of retirement accounts. For most people, a retirement account provided by your employer is 100% protected. IRA’s are 100% protected in most cases. If you are unsure about your retirement account, contact our Glendale bankruptcy lawyer today for a free consultation.

Money, Benefits or Proceeds

Benefits from ERISA-qualified retirement plan or deferred compensation plan except those amounts contributed within 120 days before a debtor files for bankruptcy. Does not apply to an alternate payee under a qualified domestic relations order. Does not apply to assets of bankruptcy proceedings filed before July 1, 1987. Not exempt from orders resulting from a judgment for child support arrearages or child support debt. A.R.S. § 33- 1126(B), and 11 U.S.C. § 522(b)(3)(C) ~~Retirement accounts exempt from taxation under the Internal Revenue Code.

Small Business Owners

These days many small business owners could be on the brink of filing for bankruptcy. Can everything your business owns be protected through the bankruptcy? Call our Glendale bankruptcy attorney to talk more about that, but a lot of things can be protected. For example, tools of the trade can be protected. Arizona has a nice exemption for your business’s tools of the trade.
TOOLS AND EQUIPMENT Tools, equipment, instruments and books (including telephone numbers, client or customer contact information, or marketing tools such as websites, domain names or any other intangible work product) in the possession of debtor or debtor’s spouse primarily used and necessary to carry or develop the commercial activity, trade, business or profession of debtor or debtor’s spouse, with a fair market value not greater than $5,000. Tools DO NOT include a motor vehicle primarily used for personal, family or household purposes such as transportation to debtor’s employment. A.R.S. § 33-1130(1)


Many people file bankruptcy because of a wage garnishment. People often wonder whether a bankruptcy can have an effect on a person’s wages or whether they are safe through the bankruptcy. You may have already read on my other blog posts that all garnishments must stop once a bankruptcy is filed. If you need help understand how this works, call our Glendale bankruptcy lawyer for an appointment. However, most wages are exempt from the bankruptcy process. The bankruptcy trustee will only look at the pay period in which you are in when your case was filed. During that pay period, a trustee may be entitled to 25% of the wages you have earned during that pay period up to the day your case was filed. You keep everything else.

Wages, Salary, Compensation

Seventy-five percent (75%) of disposable earnings. Only one-half of disposable income may be claimed exempt in response to an order for support of any person. These exemptions do not apply in a Chapter 13 bankruptcy filing. “Disposable earnings” means that remaining portion of a debtor’s wages, salary or compensation for his personal services, including bonuses and commissions, or otherwise, and includes payments pursuant to a pension or retirement program or deferred compensation plan, after deducting from such earnings those amounts required by law to be withheld. A.R.S. § 33-1131(B), (C), (D)

There are many more exemptions that protect other money, property or benefits you may be entitled to receive. Call us to speak with a Glendale bankruptcy attorney for additional help. However, you may be asking what is not protected by an exemption?

  • Tax refunds;
  • Cash on hand on the day your case is filed;
  • Equity in your home or cars or any other personal property above what the exemptions allow, and other
    real property other than your homestead;
  • Jewelry, (other than wedding rings), collectibles like art, pictures, coins, baseball cards, etc;
  • Stocks, bonds, and mutual funds.

If you are unsure about your property and whether it is exempt from bankruptcy, call our Glendale bankruptcy attorney today for help.