If you are considering bankruptcy in Texas, understanding the exemption system is one of the most important steps you can take to protect your assets. Texas is well known for its strong homestead protections and generous personal-property allowances, but you are not locked into state law only. In most cases, Texas filers may choose either the Texas exemptions or the federal exemptions—you must pick one system for your case. Selecting wisely can be the difference between keeping essential property and exposing it to the trustee. This page explains the key Texas categories—homestead, personal property, motor vehicles, wages, retirement, insurance benefits, 529 plans, and tools of the trade—so you can see how they work in chapter 7 and chapter 13.
Exemptions are not one-size-fits-all. The right approach depends on your household size, the equity in your home and vehicles, the kinds of personal property you own, and whether retirement accounts or life insurance benefits make up a meaningful part of your financial picture. For many Texans, the state homestead rules are hard to beat, but there are scenarios where the federal set offers a better overall fit—especially if you have little or no home equity and want more flexibility across smaller asset categories. Before you file, it is smart to compare the totals under each system and consider how they interact with your debt goals, such as discharging credit cards and medical bills in chapter 7 or reorganizing arrears and protecting collateral in chapter 13.
Below you will find a concise chart of the primary Texas bankruptcy exemptions with plain-English notes. Use it as a starting point for planning. Then, speak with a Texas bankruptcy attorney about which system—Texas or federal—best protects your specific mix of assets. A brief strategy session up front can help you avoid costly surprises and move forward with confidence.
| Category | Statute | Amount / Details | Notes |
|---|---|---|---|
| Homestead | Tex. Prop. Code § 41.002; Tex. Const. art. XVI, § 50 | Unlimited equity* Federal cap: for homestead interest acquired within 1,215 days before filing, 11 U.S.C. § 522(p) limits the protected equity to $214,000 (cases filed 4/1/2025–3/31/2028); certain bad-act scenarios also cap at $214,000 under § 522(q). | *Acreage: up to 10 acres (urban) or 100 (rural single), 200 (rural family). |
| Personal Property | Tex. Prop. Code § 42.001 | Up to $50,000 (single) / $100,000 (family) | Clothing, furniture, tools, firearms, etc. (aggregate cap; exclusive of liens) |
| Motor Vehicle | Tex. Prop. Code § 42.002(9) | One vehicle per licensed household member | Counts toward the personal-property aggregate cap. |
| Retirement / Pension | Tex. Prop. Code § 42.0021 | Exempt for tax-qualified plans (ERISA plans, IRAs, HSAs, 529/ABLE as specified) | Subject to tax-qualification and statutory conditions. |
| Wages | Tex. Const. art. XVI, § 28 | Current wages exempt from garnishment (state law) | Exceptions under Texas law include court-ordered child support and spousal maintenance; separate federal law allows wage collection for certain federal debts (e.g., IRS levies and federal student-loan administrative wage garnishment). |
| Insurance Benefits | Tex. Ins. Code ch. 1108 | Generally exempt | Life-insurance proceeds and annuities typically protected, subject to statutory exceptions. |
| College Savings (529 Plans) | Tex. Prop. Code § 42.0022; § 42.0021(a)(8)–(10) | Exempt if designated for a beneficiary in a qualified program | Timing and contribution rules apply. |
| Tools of the Trade | Tex. Prop. Code § 42.002(a)(4) | Included under personal-property limit | Items reasonably necessary for your occupation. |
Remember the federal residency rule: to claim Texas exemptions you must have been domiciled in Texas for the 730 days before filing. Also review the 1,215-day federal homestead cap noted above. For the latest updates, consult the official Texas statutes or a local attorney.
- Texas Constitution, Article XVI
- Texas Property Code
- Title 11 of the U.S. Code: Federal Bankruptcy Laws
Disclaimer: This comprehensive list is for reference only. Exemptions change periodically, and individual facts matter. Always seek guidance from a licensed Texas bankruptcy attorney to verify accurate exemption amounts and eligibility.
After you review the chart, the next step is to decide whether the Texas or federal system gives you better protection overall. If you own a home with meaningful equity, Texas’s unlimited homestead (subject to acreage limits) is often decisive. On the other hand, Texans who rent—or who have little home equity—sometimes prefer the federal set because of how its categories balance out across household goods, wildcard allowances, and other items. There is no universal “best” choice. A quick side-by-side analysis of your assets against both systems typically reveals which path preserves more of what matters to you.
Keep in mind that exemptions are only one piece of your bankruptcy strategy. Chapter selection, means-test outcomes, treatment of secured debts, and the timing of your filing can all affect your results. A short conversation with a Texas bankruptcy lawyer can help you chart the right plan, avoid common pitfalls, and move forward with clarity. If you are ready to compare your options, we can connect you with a pre-screened Texas attorney who will walk through your assets and recommend the exemption set that fits your goals.