Utah Bankruptcy Exemptions: Protect Your Property in Chapter 7

Utah law requires residents who have lived in the state for at least two years to use its state exemptions when filing Chapter 7 bankruptcy. Exemptions protect your property during the bankruptcy process. You can get a financial fresh start without starting from scratch.

If you’re filing as a single person, the homestead exemption in Utah is $52,400. The motor vehicle exemption is $3,000. Utah doesn’t offer a wildcard exemption.

What Are Bankruptcy Exemptions and Why Do They Matter?

Exemptions help you protect and keep your personal property during your Chapter 7 case. Though it’s very rare, the bankruptcy trustee can take unprotected property. They sell it and give the proceeds to your creditors.

When you prepare your bankruptcy petition, you’ll claim Utah exemptions to protect your property. You’ll want to claim as many as you can.

Married couples filing jointly can double the exemption values for jointly owned property. Single filers can exempt up to $1,000 for dining and kitchen tables. Couples can exempt up to $2,000. The doubling only applies to jointly owned property. If only one spouse owns the property, you cannot double the exemption.

Do You Have to Use Utah’s Bankruptcy Exemptions?

If you’ve been a Utah resident for at least two years, yes. You’ll need to use the state exemptions during your Chapter 7 case. Utah doesn’t permit its residents to use the federal bankruptcy exemptions.

Along with the state exemptions, you can also use federal non-bankruptcy exemptions. These help you protect your wages and other money benefits. If you’re unsure which exemptions apply to your situation, speak with a bankruptcy attorney for free.

What Are Utah’s Bankruptcy Exemptions?

Bankruptcy exemptions fall into three categories:

• Real property, including your home or land you may own
• Personal property, which includes household goods, furniture, and your vehicle
• Money benefits, which include retirement accounts, wages, and insurance

Real Property: The Utah Homestead Exemption

If you’re filing Chapter 7 on your own, you can exempt up to $52,400. That’s equity in your primary residence. If you’re filing jointly as a married couple, you can double this amount.

To calculate your equity, take the value of your home. Subtract what you owe on your mortgage. The difference is your equity.

If you own non-residential property and you don’t own a home, you can protect equity. You can protect up to $6,200 of your equity in that property. You can double this amount if you’re married, filing jointly, and co-own the property.

Source: Utah Code §§ 78B-5-503, 78B-5-504

Motor Vehicle Exemption

One of the most common questions: “Will I get to keep my car?”

Utah has two state exemptions that address motor vehicles. Single filers can exempt $3,000 in equity in their primary vehicle. It can’t be a recreational vehicle. Couples who are married and filing jointly can exempt up to $6,000. That’s equity value in a shared primary vehicle.

Vehicles may also be considered a tool of the trade. You can exempt up to $5,000 under the tools of the trade exemption. That includes motor vehicles as long as no other exemptions have been applied. Make sure these items are actually used in your main line of work.

Source: Utah Code § 78B-5-506(2)

Personal Property Exemptions

Utah bankruptcy exemptions allow filers to protect many kinds of personal property. In addition to motor vehicles and tools of the trade noted above.

Unless otherwise noted, the full value of the following types are exempt:

• Animals, books, and musical instruments for reasonable use (up to $1,000 aggregate)
• Beds and bedding for filers and dependents
• Burial plots for the filer and their family
• Carpets in use
• Clothing, excluding furs and jewelry
• Food provisions to feed filer and family for one year
• One freezer
• Health aids
• Heirlooms and items of particular sentimental value (up to $1,000 aggregate)
• Household furnishings reasonably necessary for one household (up to $1,000 aggregate, excluding tables and chairs)
• Guns excluding curio or relic firearms: one handgun with up to 1,000 rounds, one shotgun with up to 1,000 rounds, one shoulder arm with up to 1,000 rounds
• Kitchen tables, dining tables, and chairs reasonably necessary (up to $1,000 aggregate)
• One microwave oven
• One refrigerator
• One sewing machine
• One stove
• One washer and dryer set
• Works of art that depict the debtor or their family, excluding works held as part of a trade or business

Source: Utah Code § 78B-5-505, 78B-5-506(1)

Money Benefits

The Utah Code broadly protects benefits individuals may be eligible for. These include benefits due to physical challenges, family circumstances, or lack of employment. Exemptions for insurance proceeds and money benefits are more qualified. They’re subject to caps or other exceptions.

Unless otherwise noted, the following assets are fully exempt for Chapter 7 filers:

• Alimony or spousal support
• Child support
• Crime victims’ compensation
• Disability benefits
• ERISA-qualified benefits, if benefits have accrued or contributions were made at least 12 months before filing
• Fraternal benefit society benefits
• Illness-related benefits
• IRAs and Roth IRAs to current adjusted amount per 11 U.S.C. § 522(b)(3)(C)(n)
• Health and hospital benefits
• Higher education savings plans, not exceeding $200,000 aggregate, excluding payments made during the 18 months before filing
• Life insurance policy cash surrender value, excluding payments made within 12 months before filing
• Life insurance proceeds if the beneficiary is the insured’s spouse or dependent
• Occupational disease disability benefits
• Personal injury recovery
• Public benefits and general assistance
• Public employee pensions
• Tax-exempt retirement accounts including 401(k)s, 403(b)s, profit-sharing and money purchase plans, SEP and SIMPLE IRAs, and defined benefit plans
• Unemployment compensation
• Unmatured life insurance contract proceeds, excluding payments made within 12 months before filing
• Veterans’ benefits
• Workers’ compensation
• Wrongful death recovery if the filer was a dependent of the deceased and damages are compensatory
• Unpaid earnings due as of the bankruptcy filing: 1/24 of the median Utah annual income if paid more than once per month, 1/12 if paid monthly

Source: Utah Code §§ 78B-5-505(1)(a)(xvi)

Other Utah Exemptions

Unlike most other states, Utah does not offer a wildcard exemption. Generally, wildcard exemptions allow filers to safeguard property up to a specific amount. That property is not exempted by other provisions.

If you can’t exempt your property using the rules noted above, you have options. If you want to keep that property, you’ll probably have to pay your trustee. You’ll pay the value of the non-exempt asset you wish to keep.

Get Expert Help With Your Utah Chapter 7 Bankruptcy

Understanding Utah bankruptcy exemptions can be complex. You need to protect as much property as possible. A bankruptcy attorney can review your assets and help you maximize your exemptions.

You don’t have to navigate Chapter 7 bankruptcy alone. Professional guidance ensures you claim every exemption available. You’ll get your fresh start while keeping what matters most.