Vermont Bankruptcy Exemptions

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Like all states, Vermont has its own set of exemptions that you may use when filing for Chapter 7 or Chapter 13 bankruptcy. Exemptions determine what property (such as a home, car, instrument, retirement account, etc.) you may keep in a Chapter 7 bankruptcy, and how much you must pay to certain creditors in Chapter 13 bankruptcy.

In Vermont, you may use either the Vermont state exemptions (listed below), or the federal bankruptcy exemptions (you can find these in Federal Bankruptcy Exemptions). You cannot mix and match from each list. If you choose to use the Vermont state exemptions, you may also use any applicable amounts in the federal nonbankruptcy exemptions.

Unless noted otherwise, if a couple is married and filing jointly in Vermont, each spouse may claim the full amount of each exemption. This is informally called “doubling.”

To learn more about bankruptcy exemptions, including how they work, which state exemption system you should use, and special rules for the homestead exemption, see Bankruptcy Exemptions – What Can I Keep When I File for Bankruptcy? 

Vermont Bankruptcy Exemptions

Unless otherwise noted, all law references are to the Vermont Statutes Annotated.

Homestead

27-101 - Real property or mobile home to $125,000, including outbuildings, rents, issues, and profits. Spouse of deceased owner may claim (27 V.S.A. § 105). Tenancies by the entirety are exempt without limit as to debts of one spouse. Spouses living together may not double this amount. D'Avignon v. Palmisano, 34 B.R. 796 (D. Vt. 1982).  However, spouses living separately and filing a joint petition may claim a separate homestead exemption for each separate proeprty. In re Roberge, 307 B.R. 442, 444 (Bankr. D. Vt. 2004) order amended and supplemented, 03-11135, 2004 WL 3522695 (Bankr. D. Vt. 2004).

Personal Property

12-2740 - Motor vehicles up to $2,500; clothing, goods, furnishings, appliances, books, musical instruments, animals and crops up to $2,500 total; refrigerator, stove, freezer, water heater, heating unit and sewing machines; health aids; bank deposits up to $700; wedding ring; jewelry up to $500; 500 gallons of oil, 5 tons of coal or 10 cords of firewood; 500 gallons of bottled gas; lost future earnings for yourself or a person you depended upon; personal injury and wrongful death recoveries for a person you depended upon; 1 cow, 10 sheep, 10 chickens, 3 swarms of bees, and feed to last 1 winter; 1 yoke of oxen or steers, 2 horses, 2 harnesses, 2 halters, 2 chains, 1 plow and 1 ox yoke; growing crops up to $5,000.

Wages

12-3170 - The greater of the following: 30 times the federal minimum hourly wage or minimum of 75% of disposable weekly earnings. Judge may approve more for low income debtors; all wages if you received welfare during the 2 months prior to filing for bankruptcy.

Note: The court in In re Riendeau, 293 B.R. 832 (D.Vt. 2002) held that Vermont's wage garnishment law does not create an exemption that can be used in bankruptcy.

Pensions

11 U.S.C. § 522 - Tax exempt retirement accounts (including 401(k)s, 403(b)s, profit-sharing and money purchase plans, SEP and SIMPLE IRAs, and defined benefit plans). 

11 U.S.C. § 522(b)(3)(C)(n) - IRAS and Roth IRAs to $1,171,150.

3-476 - State employees.

12-2740 - Self-directed accounts including IRAs and Keoghs as long as contributions were made more than 1 year before filing; other pensions.

16-1946 - Teachers.

24-5066 - Municipal employees.

Public Benefits

12-2740 - Veterans' benefits, Social Security, and crime victims' compensation needed for support.

21-681 - Workers' compensation.

21-1376 - Unemployment compensation.

33-124 - General assistance; aid to blind, aged, and disabled.

Tools of Trade

12-2740 - Tools and books of trade up to $5,000.

Alimony and Child Support

12-2740 - Alimony and child support needed for support.

Insurance

8-3705 - Life insurance proceeds if policy prohibits use to pay creditors.

8-3706 - Life insurance proceeds if insured is not the beneficiary.

8-3708 - Group life or health benefits.

8-3709 - Annuity contract benefits up to $350 per month.

8-4086 - Health benefits up to $200 per month.

8-4478 - Fraternal benefit society benefits.

12-2740 - Unmatured life insurance contract (but not credit insurance policy); disability or illness benefits needed for support; life insurance proceeds for a person you depended upon.

Wildcard

12-2740 - $400 of any property; plus $7,000, less any amount claimed for clothing, goods, furnishings, appliances, books, musical instruments, animals, crops, motor vehicle, jewelry, tools of trade, and growing crops .

Other 

Add any applicable Federal Nonbankruptcy Exemptions.

Confirming Exemptions

This list includes the majority of bankruptcy exemptions available in Vermont. However, it may not include all exemptions, and states often create exceptions to specific exemptions. In addition, Vermont may have changed the amounts since this list was last updated in June of 2011. Consider cross-checking this list with www.legalconsumer.com, which updates the state exemption amounts regularly, or check with your local bankruptcy court. 

by: , J.D.

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