Updated February 5, 2019
You won't lose all of your assets when filing for bankruptcy in New Jersey. You can use New Jersey's bankruptcy exemptions to protect property you'll need to work and maintain a household, such as household furnishings, clothing, and a retirement account.
Your other choice—using the federal bankruptcy exemptions—could provide more protection, depending on the assets you own. This is especially true if you have equity in a home or vehicle because the New Jersey state statutes don't have a homestead or motor vehicle exemption.
Learn more about filing a New Jersey bankruptcy case.
Some states, including New Jersey, allow residents to choose between the state and federal bankruptcy exemptions. You can't protect property by using exemptions from both lists—you must pick the system that will work best for you. If you elect to use New Jersey's state exemptions, the federal nonbankruptcy exemptions will be available to you, too.
Here are some of the more common exemptions in New Jersey. When reviewing them, you'll want to keep these things in mind:
None; however, survivorship interest of a spouse in property held as tenancy by the entirety is exempt from creditors of the other spouse.
2A:17-19 - You can protect up to $1,000 in general personal property.
2A:17-19 – Clothing.
2A:17-19 – Stocks and interest in corporations.
2A:26-4 - Household goods and furniture up to $1,000.
45:27-21 - Burial plots.
2A:17-56 - 90% of earned but unpaid wages if your annual income is less $7,500. The percentage decreases if the filer's income is higher.
38A:4-8 Military personnel wages and allowances.
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).
A:9-57.6 - Civil defense workers.
18A:66-51 - Teachers.
18A:66-116 - School district employees.
25:2-1 – A trust containing personal property if it was created under federal tax law.
43:6A-41 - Judges.
43:7-13 - Prison employees.
43:8A-20 - Alcohol beverage control officers.
43:10-57 & 43:10-105 - County employees.
43:13-9 - City workers' ERISA-qualified benefits.
43:13-44 - Municipal employees.
43:15A-53 - Public employees.
43:16-7 & 43:16A-17 - Police officers, firefighters, and traffic officers.
43:18-12 - City boards of health employees.
43:19-17 - Street and water department employees.
53:5A-45 - State police.
34:15-29 - Workers' compensation.
43:21-53 - Unemployment compensation.
44:7-35 - Old-age and permanent disability assistance.
52:4B-64 - Crime victims' compensation.
A:9-57.6; App. A:9-57.6 - Civil defense workers' disability, death, medical or hospital benefits.
17:18-12 & 17B:24-8 - Health and disability benefits.
17B:24-6b - Life insurance proceeds, dividends, interest, loan, cash, or surrender value, if not the insured.
17B:24-7 - Annuity contract proceeds up to $500 per month.
17B:24-9 - Group life or health policy or proceeds.
17B:24-10 - Life insurance proceeds if policy prohibits use to pay creditors.
38A:4-8 - Military member disability or death benefits.
17:44B-1 - Fraternal benefit society benefits.
42:1A-11 - Partnership property.
Add any applicable federal nonbankruptcy exemptions.
Some people can keep all assets, but that isn't always true. Here's what will happen to nonexempt property:
You'll learn more about Chapter 7 and 13 in Which Type of Bankruptcy is Right for Me?
This list includes the majority of bankruptcy exemptions available in New Jersey, but not all. Specific exemptions could have qualification requirements, and amounts might have changed since this list was last updated. Check the New Jersey 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?