Ohio Bankruptcy Exemptions: What You Keep When Filing Chapter 7

You cannot choose federal exemptions in Ohio. If you've lived here at least two years, you must use Ohio's state exemptions when you file bankruptcy. That means your home equity protection tops out at $182,625 for individual filers, you can keep a car worth up to $5,025, and you have a $1,675 wildcard to plug gaps.

Those numbers matter because they determine what you lose. In Chapter 7 bankruptcy, a trustee sells your non-exempt assets to pay creditors. If your assets fit within Ohio's exemption limits, the trustee cannot touch them. Most filers keep everything they own.

How Ohio Bankruptcy Exemptions Work

When you file Chapter 7, everything you own becomes part of your bankruptcy estate. The court divides your property into two categories: exempt and non-exempt.

Exempt property is what you keep. Non-exempt property is what the trustee can sell. If you claim your exemptions correctly and your assets fall within the protected amounts, you walk away with your belongings intact and your unsecured debts discharged.

Ohio forces you to use state exemptions if you've been a resident for at least two years. This residency rule exists to stop people from moving to states with better exemptions right before filing. But you can still use federal non-bankruptcy exemptions for things like Social Security benefits, veterans' benefits, and certain retirement accounts.

Ohio Homestead Exemption: Protecting Your Home Equity

Ohio exempts up to $182,625 in home equity for individual filers. If you file jointly with a spouse, you can double that to $365,250. This protection applies to your primary residence, whether it's a house, condo, mobile home, or co-op apartment.

Equity is the difference between what your home is worth and what you owe on it. If your home is worth $250,000 and you owe $150,000 on your mortgage, you have $100,000 in equity. That amount is fully protected under Ohio's homestead exemption.

If your equity exceeds the exemption limit, the trustee can sell your home, pay off your mortgage, give you the exemption amount, and use the rest to pay creditors. In practice, trustees rarely sell homes unless the equity cushion is substantial, because selling costs eat into proceeds.

What Counts as Your Homestead

The exemption covers your primary residence and the land it sits on, up to one acre if you're in a city or town, or 160 acres if you're in a rural area. You must actually live in the property. Investment properties and vacation homes do not qualify.

Ohio Motor Vehicle Exemption

You can protect up to $5,025 in equity in one motor vehicle. That includes cars, trucks, motorcycles, and other vehicles you use for transportation. Equity works the same way as with homes: value minus what you owe.

If your car is worth $10,000 and you owe $6,000 on the loan, you have $4,000 in equity. That's fully protected. If you own your car outright and it's worth $4,500, you keep it. If it's worth $8,000 with no loan, the trustee could theoretically sell it, give you $5,025, and use the rest to pay creditors.

Most people filing bankruptcy drive modest cars with little equity. If your car is worth more than the exemption allows, you can often use the wildcard exemption to cover the gap.

Ohio Wildcard Exemption

Ohio gives you a $1,675 wildcard exemption that you can apply to any property. Use it to protect cash in your checking account, cover extra vehicle equity, or safeguard items that don't fit neatly into other categories.

If you don't use your full homestead exemption, you can convert up to $14,525 of that unused amount into additional wildcard protection. So if you rent instead of own, or if your home equity is low, you gain significant flexibility.

For example, if you have zero home equity, you could redirect $14,525 of the homestead exemption plus the base $1,675 wildcard to protect $16,200 worth of other property. That might cover a car with higher equity, tools you need for work, or cash savings.

Personal Property Exemptions in Ohio

Ohio exempts a long list of household goods and personal items, each with its own limit. Here are the key categories:

• Household furnishings, appliances, electronics: Up to $15,625 total for items like furniture, TVs, kitchen appliances, and computers. This covers most of what fills a typical home.
• Jewelry: Up to $1,875. Wedding rings are usually protected under a separate statute up to $1,000 per spouse.
• Firearms: Up to $1,875 total for guns used for hunting or personal protection.
• Books, musical instruments, pets: Up to $500 per category. If you play guitar in a band or have a small library, these exemptions cover you.
• Health aids: Unlimited exemption for medically prescribed equipment like wheelchairs, hearing aids, and prosthetics.
• Cash on hand: Up to $550. This is a small amount, so most people use the wildcard exemption for bank account balances instead.

If you own tools of the trade or equipment you need for work, Ohio exempts up to $2,800 worth. For farmers, the exemption rises to $7,525 for implements, livestock, seed, and crops.

Retirement Accounts and Pensions

Ohio exempts most retirement accounts without dollar limits. That includes 401(k)s, 403(b)s, IRAs (traditional and Roth), pensions, and profit-sharing plans. Federal law also protects ERISA-qualified retirement accounts, so you have layered protection.

Traditional and Roth IRAs are exempt up to $1,512,350 under federal non-bankruptcy exemptions. If your IRA exceeds that amount, you're in rare company and should consult a bankruptcy attorney before filing.

Public Benefits and Insurance Exemptions

Ohio and federal law exempt most public benefits from the bankruptcy estate. You can keep:

• Social Security benefits: Fully protected under federal non-bankruptcy exemptions.
• Unemployment compensation: Ohio exempts these benefits entirely.
• Workers' compensation: Fully exempt under Ohio law.
• Veterans' benefits: Protected by federal law.
• Disability benefits: Both state and federal programs are exempt.
• Life insurance: Ohio exempts the cash value of life insurance policies if the beneficiary is your spouse, child, or dependent.

If you receive any of these benefits, they do not count toward your bankruptcy estate. The trustee cannot touch them.

What Happens If You Have Non-Exempt Property

If you own assets that exceed Ohio's exemption limits, the trustee can sell them. Before that happens, you have options:

1. Negotiate with the trustee: You can offer to pay the trustee the non-exempt value in cash to keep the asset. If your car has $2,000 in non-exempt equity, you might pay the trustee $2,000 to keep the vehicle.
2. Redeem secured property: For secured debts like car loans, you can pay the creditor the current market value of the collateral in a lump sum to keep it.
3. Convert to Chapter 13: If you have significant non-exempt assets, Chapter 13 bankruptcy might be a better fit. You keep your property and repay creditors through a 3-5 year payment plan.

Most filers do not have non-exempt property. Trustees close the majority of Chapter 7 cases as "no-asset" cases, meaning there is nothing to sell.

How to Claim Ohio Bankruptcy Exemptions

You claim exemptions on Schedule C of your bankruptcy petition. This form lists every asset you own and the exemption statute that protects it. You must be specific: cite the Ohio Revised Code section, list the asset's value, and state the exemption amount.

If you make a mistake or forget to claim an exemption, the trustee or creditors can object. You usually get a chance to amend your schedules, but it's easier to get it right the first time.

Ohio's exemptions are found in Ohio Revised Code Section 2329.66. When you fill out Schedule C, you'll reference the specific subsections that apply to your property.

The Two-Year Residency Rule

If you moved to Ohio recently, things get complicated. Bankruptcy law requires you to use the exemptions of the state where you lived for the better part of the 180 days before the two years preceding your filing date.

Translation: If you haven't lived in Ohio for at least two years before filing, you might have to use your previous state's exemptions. If that state allows the federal exemptions, you can use those instead.

If you've moved multiple times in the past few years, talk to a bankruptcy attorney. The rules for determining which exemptions apply can get messy.

Federal Non-Bankruptcy Exemptions You Can Use

Even though Ohio does not allow federal bankruptcy exemptions, you can still use federal non-bankruptcy exemptions. These protect specific types of income and benefits, including:

• Social Security and SSI benefits
• Veterans' benefits and military retirement
• Federal employee retirement benefits (Civil Service, FERS)
• Railroad Retirement benefits
• Longshoremen's and Harbor Workers' Compensation

These exemptions exist outside the Bankruptcy Code, in separate federal statutes. They apply automatically, regardless of which state exemptions you use.

Common Mistakes When Claiming Ohio Exemptions

People filing without an attorney often make these errors:

• Undervaluing assets: The trustee can challenge your valuations. Use realistic estimates based on what the item would sell for today, not what you paid for it.
• Forgetting to claim an exemption: If you don't list an exemption on Schedule C, you might lose the asset.
• Claiming the wrong statute: Ohio has specific exemption statutes. Citing the wrong code section can cause problems.
• Not accounting for married filers: If you file jointly, you can double most exemptions. Don't leave that money on the table.

Before you file, review every asset and every exemption carefully. If something seems unclear, ask for help. Our free bankruptcy screener can help you determine if Chapter 7 is right for your situation.

When You Might Lose Property in Ohio Chapter 7

You risk losing assets if:

• Your home equity exceeds $182,625 (or $365,250 if filing jointly)
• You own multiple vehicles and the combined equity exceeds what you can protect
• You have luxury items like expensive jewelry, art, or collectibles that exceed exemption limits
• You own rental properties or second homes
• You have significant cash savings that exceed the wildcard exemption

If any of these apply, calculate your non-exempt equity carefully. You might still file Chapter 7 if the non-exempt amount is small, or you might consider Chapter 13 instead.

The Bottom Line

Ohio's bankruptcy exemptions protect the essentials: your home up to $182,625, a car up to $5,025, household goods, retirement accounts, and public benefits. Most people who file Chapter 7 in Ohio keep everything they own because their assets fit within these limits. If your situation is more complex, get guidance before filing. The rules are strict, but if you claim exemptions correctly, you can discharge your debts and rebuild without losing the things that matter.