Nebraska Bankruptcy Exemptions

You can protect property in a Nebraska bankruptcy using Nebraska's bankruptcy exemptions.

February 6, 2019

You won’t lose everything when filing for bankruptcy in Nebraska. You’ll be able to use Nebraska’s bankruptcy exemptions to protect property you’ll need to work and live, such as your home, personal items, and a retirement account.

Find out more about filing a Nebraska bankruptcy case.

Nebraska Exemptions v. Federal Bankruptcy Exemptions

Some states allow residents to choose between the state and the federal bankruptcy exemptions, but the option isn’t available in Nebraska. You’ll use Nebraska’s state exemptions and, if helpful, the federal nonbankruptcy exemptions.

Common Nebraska Bankruptcy Exemptions

Here are some of the more common exemptions in Nebraska. When reviewing them, you’ll want to keep these things in mind:

  • Joint filing. Unless otherwise noted, when spouses file together in Nebraska, each spouse can claim the full amount of the exemption (informally called “doubling”) as long as each spouse has an ownership interest in the property.
  • List and verify your exemptions. You must claim an exemption by listing it in the official bankruptcy forms. You might qualify for exemptions not included in this article, or be required to meet qualification requirements. Consulting with a local bankruptcy attorney is the best way to ensure that you’re protecting your assets.
  • Legal citations. You’ll find each of the statutes in the Nebraska Revised Statutes or the federal law.

Nebraska Homestead Exemption

40-101 – 40-118 - $60,000 of equity in a residential property not to exceed 160 acres.

Nebraska Motor Vehicle Exemption

25-1556(e) – Equity in one motor vehicle per debtor up to $5,000.

Nebraska Wildcard Exemption

25-1552(1) - $5,000 of any personal property (not real estate or wages).

Other Nebraska Exemptions

Personal Property

12-517 - Burial plot.

25-1556(1), (2), (3), and (5) – Clothing; health aids; personal possessions; household goods and furnishings to $3,000.

25-1563.02 - Recovery for personal injuries.

Wages

25-1558 - For the head of household, a minimum 85% of earned but unpaid weekly earnings or pension payments. For all others, the greater of the following: 30 times the federal minimum hourly wage or 75% of earned but unpaid earnings.

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 maximum (amount changes).

23-2322 - County employees.

25-1559 - Military disability benefits to $2,000.

25-1563.01 - ERISA-qualified benefits needed for support including IRAs and Roth IRAs.

48-1401 - Public employees' deferred compensation.

79-948 - School employees.

84-1324 - State employees.

Public Benefits

48-149 - Workers' compensation.

48-647 - Unemployment compensation.

68-148 - General assistance to the poor.

68-1013 - Aid to blind, aged, and disabled; public assistance.

25-1553 - Earned income tax credit.

Tools of the Trade

25-1556(4) - Tools or equipment up to $5,000, but not a motor vehicle.

Insurance

44-371 - Life insurance or annuity contract proceeds up to $100,000.

44-1089 – Fraternal benefit society benefits to $10,000.

Other

67-325(2(c) – Some partnership property.

Add any applicable federal nonbankruptcy exemptions.

Nonexempt Property—Property You Can’t Protect With a Nebraska Exemption

Some people can keep all assets, but that isn’t always true. Here’s what will happen to nonexempt property:

  • In a Chapter 7 bankruptcy, the bankruptcy trustee appointed to administer your case will sell nonexempt property and distribute the proceeds to creditors. Find out more about the bankruptcy process and the Chapter 7 documents you'll need at each stage.
  • In a Chapter 13 bankruptcy, it works differently. You can keep everything you own, but you’ll pay creditors the value of the nonexempt property, your disposable income, or your nondischargeable debt (support obligations, most taxes, and the like), whichever is more, through your Chapter 13 repayment plan.

You’ll learn more about Chapter 7 and 13 in Which Type of Bankruptcy is Right for Me?

Confirming Nebraska Exemptions

This list includes the majority of bankruptcy exemptions available in Nebraska. However, doesn’t include all exemptions. Also, states often create qualification requirements for specific exemptions, and Nebraska might have changed the amounts since this list was last updated. Check the Nebraska Revised Statutes or with a local bankruptcy lawyer.

To learn more about bankruptcy exemptions, the state exemption system, and the homestead exemption rules, read Bankruptcy Exemptions – What Can I Keep When I File for Bankruptcy?

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