Sources checked . This is a source-check date, not an attorney-review date. See scope and limits.
What can you keep in a Delaware bankruptcy?
When Delaware exemption law applies, the main allowances are $200,000 in principal-residence equity, $25,000 in general property per debtor, and separate $25,000 allowances for an employment vehicle and employment tools per debtor. The residence limit stays $200,000 in a joint case. Retirement, insurance, and benefits may have their own protections. See 10 Del. C. § 4914 and 10 Del. C. § 4915.
An exemption protects qualifying property from being used to pay creditors in bankruptcy. It does not erase a mortgage or car loan. There is no current $5,000 single-filer or $10,000 married-couple ceiling on all Delaware exemptions combined. The useful question is which rule protects each asset and whether your interest fits within its limit.
Start with the four bankruptcy allowances
The amounts below come from 10 Del. C. § 4914. Its residence, vehicle, and tools protections are additional to the general-property allowance, but each has its own conditions. Do not add every row into one unrestricted spending allowance or count the same equity twice.
| Property | Amount and qualifying use | Joint-filing rule |
|---|---|---|
| Principal residence | Up to $200,000 of equity in real property or a qualifying manufactured home used as your principal residence. 10 Del. C. § 4914(c)(1). | $200,000 total in an individual or joint case, not $200,000 per spouse. 10 Del. C. § 4914(d). |
| General property | Up to $25,000 per debtor across personal property and equity in real property other than the principal residence. Cash, household goods, and other interests may compete for this allowance. 10 Del. C. § 4914(b). | Each debtor has a $25,000 allowance for their own interests. Up to $50,000 across two eligible debtors, subject to ownership. 10 Del. C. § 4914(d). |
| Employment vehicle | Up to $25,000 in a vehicle necessary for employment. This is not an automatic exemption for every car you own. 10 Del. C. § 4914(c)(2). | Up to $25,000 for each debtor’s qualifying vehicle interest. 10 Del. C. § 4914(d). |
| Employment tools | A separate $25,000 allowance for tools of the trade necessary for employment. 10 Del. C. § 4914(c)(2). | Up to $25,000 for each debtor’s qualifying tools. 10 Del. C. § 4914(d). |
The residence increase to $200,000 and employment vehicle/tools increases to $25,000 took effect August 2, 2024 under 84 Del. Laws c. 329, §§ 1 and 3. The general-property allowance increased to $25,000 in 2005 under 75 Del. Laws c. 131; the 2024 act did not create it.
Your move dates can change which law applies
Delaware opts out of the federal bankruptcy exemption list in 11 U.S.C. § 522(d). If Delaware law governs your exemptions, you generally cannot choose that list instead or add its wildcard to Delaware’s allowances. See 10 Del. C. § 4914(a).
Filing in Delaware or living here today is not enough to settle the question. Under § 522(b)(3)(A), the usual rule looks to your domicile, meaning your legal home, throughout the 730 days before filing. If you were not domiciled in one state for that whole period, look at the 180 days immediately before it and the state where you were domiciled for the longer portion than anywhere else. If this rule leaves you ineligible for any exemption, a federal-exemption fallback applies. The exemption law finder can help organize your move dates.
Opting out does not remove every federal protection. Applicable federal exemptions outside the § 522(d) list, qualifying retirement funds, and certain entireties interests remain separate routes under § 522(b)(3). Availability depends on the property and the governing law.
Work with equity, not just the purchase price. Start with current fair market value, subtract applicable liens, then determine the interest you own. For joint property, review the title and ownership rules rather than assuming equal shares. Bankruptcy generally uses the petition-date value under § 522(a)(2). A spouse cannot use an allowance to protect an interest they do not own.
The home limit applies to equity, and does not double
Hypothetical: a home with $180,000 of equity
Assume an eligible debtor owns a principal residence worth $360,000, owes $180,000 on its only mortgage, and has no disqualifying facts. The $180,000 equity fits within the $200,000 residence allowance. The mortgage still must be addressed.
If the same home were debt-free, its $360,000 value would exceed that allowance by $160,000 before considering any other legally available protection or sale costs. Filing jointly would not raise the statutory residence limit. The general-property allowance expressly excludes the principal residence.
A different ownership rule may matter for spouses who hold property as tenants by the entirety. Under § 522(b)(3)(B), protection depends on immunity from creditor process under applicable nonbankruptcy law. Separate debts and debts owed by both spouses can produce different results. In re Kelly, 316 B.R. 629 (D. Del. 2004) discusses Delaware entireties protection and joint creditors. Marriage or joint title alone does not establish an unlimited exemption.
Match work vehicles, cash, and refunds to the right allowance
The employment requirement matters. A vehicle needed for work may qualify under § 4914(c)(2); a recreational or extra vehicle does not qualify merely because it is titled in your name. A vehicle that does not meet that rule may use available general-property protection. Review the need for the vehicle, ownership, liens, and any allocation between legally available exemptions.
Hypothetical: protecting a work car and everyday savings
Assume one eligible filer owns a car necessary for employment worth $28,000 with an $8,000 loan. Its $20,000 equity fits within the separate employment-vehicle allowance.
The filer also allocates $6,000 in ordinary bank funds, a $3,000 tax-refund interest, and $7,000 of household goods to the general-property allowance. That uses $16,000 of the $25,000 allowance, leaving $9,000 for other qualifying property. The work-car equity is not counted again, and this example assumes no other exemption is claimed for those household goods.
This illustrates allocation, not a complete exemption determination. The refund example assumes $3,000 is the filer’s bankruptcy-estate interest. Whether a refund belongs to the estate, including the portion attributable to the period before filing, is a separate question under 11 U.S.C. § 541.
A bank account does not have one legal character just because all the money sits together. Ordinary savings may use the general allowance; protected benefits may have their own rules. Keep statements tracing deposits and spending. Some protections change when funds are paid out or mixed with other money.
Retirement protection depends on the plan and the claim
10 Del. C. § 4915(a), (f) protects assets held or amounts payable under qualifying retirement arrangements described in Internal Revenue Code §§ 401, 403, 408, 408A, 409, 414, or 457. It expressly includes qualifying inherited arrangements. The state provision does not state a general dollar ceiling, but an account labeled “retirement” is not enough: its legal and tax status must fit.
Eligible rollover distributions receive 60 days of protection under 10 Del. C. § 4915(b), with continued protection if contributed to a retirement plan within that period. Retirement-plan exceptions include specified family support and divorce relief, qualified domestic relations orders, and valid liens securing plan loans. Section 4915 also excepts state tax judgments under 30 Del. C. § 554. An alternate payee’s interest under a qualifying domestic relations order has its own creditor protection. See 10 Del. C. § 4915(c)–(g).
Federal law separately protects qualifying retirement funds under § 522(b)(3)(C); some trust interests may be excluded from the estate under § 541(c)(2). For covered traditional and Roth IRA funds claimed under the federal retirement exemption, § 522(n) has an aggregate $1,711,975 limit for cases filed on or after April 1, 2025, subject to its rollover exclusions and possible court increase. SEP and SIMPLE IRAs are excluded from that cap. This is not a universal cap on all retirement plans or on Delaware’s separate exemption. See the federal adjustment notice.
An inherited account needs special care: Delaware’s express inherited-plan language and the federal “retirement funds” requirement are different legal routes. Confirm the applicable exemption before withdrawing money, changing beneficiaries, or using retirement savings to pay debts.
Public pension plans have additional rules
- State employees’ plan, 29 Del. C. § 5503: protection from attachment and execution, except specified Delaware Family Court periodic-payment orders and benefits payable under § 5546.
- County and municipal police/firefighter plan, 11 Del. C. § 8803: an exception for specified Delaware Family Court periodic-payment orders.
- Volunteer firemen’s plan, 16 Del. C. § 6653: the same type of Family Court exception. This provision covers the named plan, not every volunteer’s savings.
Wages and public benefits require attention to the source
The protections below have different conditions. Federal bankruptcy exceptions for certain taxes, support debts, and valid liens can also matter under § 522(c).
| Payment | Rule and important limits |
|---|---|
| Employee wages | 10 Del. C. § 4913 protects 85% of a Delaware resident’s wages from attachment, except process for fines, costs, or taxes owed to the state. It includes employee salaries and commissions, but excludes self-employment service payments. Federal limits on garnishment of disposable earnings can provide additional protection, especially at lower incomes, under 15 U.S.C. § 1673. This is not a promise that 85% of accumulated bank deposits is exempt. |
| State public assistance | Money paid or payable under the State Public Assistance Code is protected, including in bankruptcy, under 31 Del. C. § 513. Lawful state overpayment recoupment is an exception; the assistance unit must retain, in combined aid, income, and liquid resources, at least 90% of the state-plan amount for a same-size family with no other income. |
| Unemployment benefits | Rights to benefits are protected. Received benefits must remain unmixed with other funds, and exceptions apply for necessaries furnished to the recipient, spouse, or dependents during unemployment and for child support. 19 Del. C. § 3374. |
| Workers’ compensation | Claims and compensation are protected, with an exception for specified child-support attachments. The statute covers Delaware benefits and compensation under another state’s, a U.S. territory’s or possession’s, or D.C.’s workers’ compensation law. 19 Del. C. § 2355; the expanded geographic language took effect in the August 2, 2024 act, §§ 2–3. |
For Social Security or SSI, identify the actual federal benefit and its governing protection rather than treating it as state assistance. 42 U.S.C. § 407 protects Social Security rights and payments, and § 1383(d)(1) applies that protection to SSI. Separate federal collection exceptions and tracing of paid benefits still require review.
Insurance and annuities are not governed by the old $350 rule
| Coverage | What to check |
|---|---|
| Life insurance and annuity contracts | 10 Del. C. § 4915(a), (f) protects assets held or amounts payable under contracts meeting the definitions in Internal Revenue Code § 1035(b). It has no $350-per-month annuity limit. Identify your ownership, cash value, beneficiary rights, and whether money is still held or payable under the contract; do not assume every withdrawn dollar stays protected. The state-tax judgment exception in § 4915(g) also applies. |
| Group life or health insurance | 18 Del. C. § 2727 protects the policy or proceeds before and after payment. Creditor-issued insurance covering debtors is excepted to the extent the proceeds pay the insured obligation. |
| Health and supplemental disability benefits | 18 Del. C. § 2726 protects health-insurance proceeds and covered disability benefits against the insured’s debts and a beneficiary’s debts existing when the proceeds become available, subject to contrary express policy or contract terms. |
| Fraternal benefit societies | 18 Del. C. § 6218 protects qualifying society benefits before and after payment against debts of the member, beneficiary, or other person entitled to them. |
Chapter 27’s insurance provisions have their own scope, including a limitation for policies not issued for delivery in Delaware and not delivered here. Review 18 Del. C. § 2701 with the actual policy. A provision allowing an insurer to retain proceeds under § 2729 is not a general exemption based on an “anti-creditor clause.”
Education and ABLE savings have contribution limits
10 Del. C. § 4916 protects qualifying § 529 tuition and § 529A ABLE accounts and proceeds, within the contribution ceilings the statute incorporates. For contributions during the preceding 365 days, it excludes the portion above the greater of $5,000 or the debtor’s average annual contribution to that account during the two preceding calendar years. Support judgments under Title 13, chapter 5 and state tax judgments under Title 30, § 554 are exceptions.
Keep contribution dates and account records. A large last-minute deposit is not automatically protected simply because the receiving account is a college-savings or ABLE account.
Other household protections are narrower than their labels suggest
Delaware also has ordinary execution and attachment exemptions. Section 4914(a) recognizes exemptions otherwise authorized by Delaware law, but the provisions below have their own requirements. Review how they apply in bankruptcy rather than automatically adding every amount to the main allowances.
| Property | Statutory conditions |
|---|---|
| Family belongings, clothing, burial, and worship | 10 Del. C. § 4902(a) lists a resident’s family Bible, schoolbooks and family library, family pictures, wearing apparel for the debtor and family, burial-ground lot, and seat or pew in a place of worship. It does not expressly classify all jewelry as clothing. Ordinary jewelry may instead use available general-property protection. |
| Sewing machines | Machines owned and used by seamstresses or private families qualify; machines kept for sale or hire do not. 10 Del. C. § 4902(c). |
| Leased musical instruments | The rule covers leased or hired pianos, piano-playing attachments, and organs, with notice to the landlord that the instrument is hired or leased. It does not generally exempt an owned piano. 10 Del. C. § 4902(d). |
| Trade tools under ordinary collection law | 10 Del. C. § 4902(b) still lists $75 in New Castle and Sussex Counties and $50 in Kent County for necessary trade or business tools, implements, and fixtures. Those are different from the $25,000 bankruptcy employment-tools allowance above. |
| Head-of-family property | 10 Del. C. § 4903 allows $500 in selected personal property for a qualifying resident head of family, excluding merchantable business stock. Its exception for debts owed to clerks, mechanics, laborers, or other employees covers nonprofessional labor or services. Spouses cannot each claim the full head-of-family exemption under 10 Del. C. § 4904. This is not Delaware’s main bankruptcy general-property allowance. |
Partnership assets are different from your business interest
Under 6 Del. C. § 15-501, a partner generally does not co-own specific partnership property, subject to the statutory exception for provisions in the partnership statements and agreement. But the partner’s economic interest is personal property, and creditors may pursue a charging order against it under § 15-504. A business owning its equipment does not make your ownership interest in the business categorically exempt.
What the exemptions mean for your filing decision
In chapter 7, a trustee may sell property with nonexempt value to pay creditors. In chapter 13, nonexempt value affects the minimum unsecured creditors must receive under the liquidation-value test, along with other plan requirements. Exemptions do not bring missed mortgage or car payments current. See § 704(a)(1), § 1325(a)(4), and § 522(c). The chapter 7 versus chapter 13 guide explains the broader choice.
- List everything you own, including jointly held property, refunds, business interests, pending claims, and assets you believe are protected.
- Gather realistic values, titles, loan payoffs, deposit records, plan documents, insurance policies, and recent transfer and move dates.
- Identify the legal basis for each exemption and claim it on Schedule C. Do not omit property because you expect it to be exempt.
Before giving away property, changing a title, paying down a loan, or cashing out retirement savings, have the proposed transaction reviewed against your filing options.
Sources, effective dates, and limits
The linked statutes and federal adjustment notice were checked October 9, 2026. The main Delaware increases took effect on enactment of 84 Del. Laws c. 329, August 2, 2024. Federal adjusted amounts cited here apply to cases filed on or after April 1, 2025.
Older tables may cite life-insurance and annuity §§ 2725 and 2728, repealed July 11, 2018; Kent County pension § 4316, repealed April 5, 1988; or blindness-assistance § 2309, repealed October 10, 2022. Those provisions do not establish current exemptions. A county pension or disability benefit may still qualify under its actual plan or benefit law.
The official Code’s compilation notice identifies enactments through September 10, 2026, including 85 Del. Laws c. 518. A complete check of later enactments and subsequent case treatment remains outstanding. This guide does not certify that every intervening change or every available exemption has been identified. Ownership, mixed deposits, plan and policy rights, and combinations of exemptions need review against the facts. The source-check date does not represent attorney review or approval. Educational information only, not legal advice for your case.