Ohio Bankruptcy Laws

Ohio County Map

Basics for Buckeyes:

What Are Exemptions?

For most purposes, the Ohio legislature determines how much, and what, you get to keep. Those amounts are called “exemptions” in bankruptcy jargon. Often, exemptions are the determining factor whether a trustee will take property and sell it, or whether a person should file a Chapter 7 in Ohio or Chapter 13 in Ohio. Ohio’s exemptions are pegged to inflation and adjust at three year intervals according to the CPI, or Consumer Price Index, the federal government’s “inflation calculator.”

Useful Ohio exemptions, per filer:

  • $20,200 of a personal residence
  • $3,225 in one automobile
  • $400 cash
  • $20,200 of a personal injury award
  • $10,775 of household goods
  • $1,350 of jewelry
  • $2,025 of tools of trade
  • $1,075 of any personal property
  • Unlimited amount of Life & Health Insurance, Health Aids, Burial Lots, Living Maintenance, workers’ Compensation, Unemployment Benefits, Ohio Works First Cash Assistance, Benefits/Services From Prevention, Retention and Contingency Programs, Disability Financial Assistance, Pension, Benefit, Annuity, Retirement Allowance, Accumulated Contributions, PERS Deferred Compensation, Ohio Public Safety Officers Death Benefit Fund, IRA, Roth IRA, Education Individual Retirement Account and Keogh or H.R. 10 Plan, Child and Spousal Support, Partnership Property, Notarial Seal, Tuition Payment Contract, Social Security Payments, Railroad Workers’ Unemployment Insurance, Railroad Retirement Act Annuities and Pensions, Civil Service Retirement Benefits, Federally Insured or Guaranteed Student Loans, Grants.

Redone Deeds If You Don’t Ain’t Cheap

Exemption planning is extremely important. For instance, suppose a husband and wife want to file bankruptcy; they own a house together–that is to say, both of their incomes go to pay the mortgage–but only she is on the deed.

  • Technically, and legally, for bankruptcy purposes, only the wife has an “interest” in the house, and they would be able to protect only $20,200 of equity in the home, not the $40,400 they could protect if they were both on the deed.
  • If the house’s value exceeds its mortgage(s) by $20,200 and the amount of time, hassle and fee the trustee will have to expend in the selling, the trustee will want to take their house sell it for the benefit of creditors!
  • Our hypothetical couple should execute a new deed prior to filing to protect more of their home.