Ohio Bankruptcy Exemptions: Protect Assets Securely

If you are considering filing for bankruptcy in the Buckeye state, you are probably worried about losing your assets. You are not alone, and it's a healthy concern. The good news is that Ohio bankruptcy exemptions allow you to keep certain assets in bankruptcy. Ohio is an "opt-out" bankruptcy exemption state, meaning that when you file bankruptcy in Ohio, you use the Ohio state-specific exemptions, and not the federal exemptions.

In the following guide, we provide you with a useful table of exemptions and will explain most widely used Ohio bankruptcy exemptions, including the homestead exemption, vehicle exemption, and other important protections that can help you safeguard your assets during the bankruptcy process.

What Are Ohio's Bankruptcy Exemptions?

These exemptions are designed to make sure that you have what you need to maintain a basic standard of living while you work through your financial difficulties. In Ohio, as in many other states, specific assets are protected up to a certain value, allowing you to retain them through the bankruptcy process.

Below is an extensive list of Ohio bankruptcy exemptions. For a more comprehensive list, please see Ohio bankruptcy exemptions reference guide. Please note that while exemptions may seem pretty "straightforward," they change often, and are impacted often by court rulings. We strongly encourage anyone considering filing bankruptcy to get an experienced local Ohio bankruptcy attorney.

Ohio Bankruptcy Exemptions Chart

Domicile Requirement to Claim Ohio Exemptions

If you have been domiciled in Ohio for 730 days you must use Ohio bankruptcy exemptions. Below we will explain the most commonly used Ohio bankruptcy exemptions.

Ohio Homestead Exemption Explained

One of the most significant exemptions in Ohio is the homestead exemption. This exemption allows you to protect the equity in your home up to a certain amount, which can be crucial for ensuring that you do not lose your residence during bankruptcy proceedings.

As of the current law, Ohio's homestead exemption is $182,625. This means you can protect up to $182,625 of equity in your primary residence. Married couples filing jointly can double this exemption to $365,250. Keep in mind that both spouses need to have an interest in the property. It's important to note that this amount is subject to change, so it's advisable to check for the latest figures when considering your options.

Beware of Federal Homestead Cap if You’ve Lived in Ohio Less Than 1,215 Days

Bankruptcy filers should be aware that even if Ohio’s exemptions apply, federal law could cap the amount of homestead exemption that can be claimed if they purchased their homestead within 1,215 days (~3.3 years) before filing (11 U.S.C. § 522(p)).

Ohio Bankruptcy Vehicle Exemption Explained

Transportation is a necessity for most people, whether it's for commuting to work or running daily errands. Ohio recognizes this need and provides a vehicle exemption to protect your automobile during bankruptcy.

Currently, Ohio allows you to exempt up to $5,025 in equity in one motor vehicle. This means if your car is worth $10,000 and you owe $6,000 on it, you would not lose the car to creditors because your equity ($4,000) is within the exemption limit.

Ohio Vehicle Exemption for Joint Cases

If you are married and file a joint case both of you can claim the exemption on separate vehicles, or if both names are on the title of one vehicle, can each claim the exemption on the same vehicle, effectively doubling the exemption to $10,050. This exemption allows for "one motor vehicle per debtor," so a single debtor couldn't split their exemption across multiple vehicles.

Is There an Increased Ohio Vehicle Amount for the Disabled?

Ohio does not provide a higher motor vehicle exemption amount for vehicles modified for the disabled, or vehicles with handicapped registrations. However, if a vehicle has adaptive equipment that was prescribed by a doctor, a disabled filer might be able to exempt the value of the modifications under the "professionally prescribed or medically necessary health aids" exemptions (R.C. 2329.66(A)(7)).

Courts have treated the value of those modifications as potentially exempt under that provision, but the base vehicle would still fall under the regular $5,025 limit. Previously in an Ohio case an unmodified van was rejected as a health aid, but the court noted authority where only the value of special modifications was exempt. Obviously if you are going to go down this road, you would want to seek the advice of an experienced Ohio bankruptcy attorney.

Other Important Ohio Bankruptcy Exemptions

In addition to the homestead and vehicle exemptions, Ohio offers several other exemptions that can protect your assets:

• Personal Property Exemption: You can exempt up to $16,850 in household goods, furniture, clothing, appliances, books, animals, crops, and musical instruments. The value is limited to $800 per item.
• Wildcard Exemption: Ohio allows a wildcard exemption of $1,675, which you can apply to any property you choose. This is especially useful if you have an asset that doesn't fit into other exemption categories.
• Wage Exemption: 75% of your earned but unpaid wages, or 30 times the federal minimum wage, whichever is greater, can be protected.
• Tools of the Trade Exemption: If you own tools or equipment necessary for your work, you can exempt up to $3,200 worth of these items.

How to Use Ohio Bankruptcy Exemptions

Understanding and applying these exemptions correctly is essential for protecting your assets during bankruptcy. Here are some steps to follow:

• Evaluate Your Assets: List all your assets and their current market values. Determine which assets fall under each exemption category.
• Calculate Your Equity: For assets like your home and car, calculate your equity by subtracting any outstanding loan balances from the asset's current value.
• Apply Exemptions Strategically: Use the exemptions where they will provide the most benefit. For instance, if you have a high-value vehicle, consider applying both the vehicle and wild card exemptions to maximize protection.
• Consult with a Bankruptcy Attorney: Navigating bankruptcy laws can be complex. An experienced bankruptcy attorney can help you understand your options and ensure that you apply the exemptions correctly.

Rebuilding After Bankruptcy

After bankruptcy, it's important to focus on rebuilding your financial health. Here are some tips:

• Create a Budget: Develop a realistic budget to manage your expenses and avoid future debt.
• Build an Emergency Fund: Start saving a portion of your income to create a financial cushion for unexpected expenses.
• Monitor Your Credit Report: Regularly check your credit report to ensure that all debts included in the bankruptcy are accurately reported.
• Consider Credit Counseling: Professional credit counseling can provide guidance and support as you work to rebuild your credit.

Get Legal Help with Exemptions

Bankruptcy exemptions may seem pretty straightforward but they change often, and are impacted often by court rulings. We strongly encourage anyone considering filing bankruptcy to get an experienced local bankruptcy attorney.

By knowing which assets you can protect and how to apply these exemptions, you can navigate the bankruptcy process with greater confidence and secure a more stable financial future. Whether you're filing chapter 7 bankruptcy in Ohio or chapter 13 bankruptcy in Ohio, Ohio’s exemptions help protect your home, vehicle, and personal property. However, bankruptcy laws can be complex, and it's highly recommended to consult with an attorney to understand how exemptions apply to your specific situation.

Examples of Ohio Bankruptcy Exemptions Being Used

Bankruptcy exemptions are not just numbers in a statute—they make the difference between what you keep and what you may have to surrender. To help you understand how Ohio exemptions really work, here are three practical examples that show how they can apply in everyday situations.

Example 1: Protecting a Family Home

Sarah and James own a home in Cleveland with $150,000 in equity. Because Ohio’s homestead exemption protects up to $182,625 in equity, their home is fully exempt. Even if they file for chapter 7 bankruptcy, the trustee cannot force the sale of their home to pay creditors. This exemption allows families like Sarah and James to reorganize their debts without losing the stability of their residence.

Example 2: Keeping a Necessary Vehicle

Marcus, a teacher from Columbus, drives a car worth $9,000, but he still owes $5,000 on his auto loan. His equity is only $4,000, which is under Ohio’s motor vehicle exemption of $5,025. That means Marcus can keep his car, which is crucial for commuting to work. Without this exemption, he might have been forced to sell his vehicle, making it harder to maintain steady income during financial recovery.

Example 3: Household Items and Furnishings

Emily, a single parent in Dayton, owns typical household furniture and appliances worth about $10,000. Ohio’s exemption for household goods and furnishings protects up to $800 per item, with a total value of $16,850. Because her belongings fall under that limit, everything from her living room couch to her children’s beds remains safe. This exemption ensures that people can maintain a reasonable standard of living while working through the bankruptcy process.

These examples highlight how Ohio bankruptcy exemptions give individuals and families a fair chance to reset financially without losing the essentials of daily life. From your home to your car to your household necessities, the law is designed to protect what you need most while allowing a fresh start.

Ohio Bankruptcy Exemptions FAQs

Bankruptcy Resources for Your Ohio City

We’ve created resources for individuals in major cities across Ohio. Click below for more tailored information:

• Akron
• Canton
• Cincinnati
• Cleveland
• Columbus
• Dayton
• Springfield
• Toledo