South Dakota Bankruptcy Exemptions

You can protect property in a South Dakota bankruptcy using South Dakota's bankruptcy exemption laws.

Updated January 30, 2019

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

Find out more about filing a South Dakota bankruptcy case.

South Dakota Exemptions v. Federal Bankruptcy Exemptions

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

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?

Common South Dakota Bankruptcy Exemptions

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

  • Joint filing. Unless otherwise noted, when spouses file together in South Dakota, 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 South Dakota Codified Laws or the federal law.

South Dakota Homestead Exemption

43-31-1 & 43-31-2 & 43-31-5 – Unlimited equity in a homestead (which can include a house or mobile home) as long as it doesn’t exceed one acre in a town or 160 acres elsewhere. Sale proceeds are exempt for one year after a sale up to $60,000 (up to $170,000 if the debtor is a widow, widower, or over 70 years old and not married).

South Dakota Wildcard Exemption

43-45-4 – A single filer can choose any personal property, including cash, up to a value of $5,000. This amount increases to $7,000 if the filer is the head of the family.

Personal Property

43-45-2 – A debtor can claim clothing; food and fuel to last one year; a bible and books up to $200; pictures; church pew; burial plot; health aids professionally prescribed.

47-29-25 - Cemetery association property.

Wages

15-20-12 - Earned wages during the 60 days before filing for bankruptcy if the funds are needed for support.

24-8-10 - Wages of prisoners in work programs.

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 (amounts change).

3-12-115 - Public employees.

9-16-47 - City employees.

43-45-16 - ERISA-qualified benefits up to $1,000,000 of income and distribution.

Public Benefits

23A-28B-24 - Crime victims' compensation.

28-7A-18 - Public assistance.

61-6-28 - Unemployment compensation.

62-4-42 - Workers' compensation.

Insurance

43-45-6 - Life insurance proceeds up to $10,000 (but this exemption might not apply in a bankruptcy case—see local counsel).

58-12-4 – Life or health insurance benefits up to $20,000.

58-12-8 - Annuity contract proceeds up to $250 per month.

58-15-70 - Life insurance proceeds if policy prohibits use to pay creditors.

58-37A-18 - Fraternal benefit society benefits.

Other

Add any applicable federal nonbankruptcy exemptions.

Nonexempt Property—Property You Can’t Protect With a South Dakota 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 South Dakota Exemptions

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

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