What are the Missouri Bankruptcy Exemptions?

What Are Missouri Bankruptcy Exemptions and Why Are They Important in Chapter 7 Bankruptcy?

Filing bankruptcy can be a tough decision. Many people assume that filing a Missouri bankruptcy means your property will be taken away by the bankruptcy court. Fortunately, Missouri bankruptcy exemptions allow you to file for bankruptcy and protect most of your property. The bankruptcy court allows filers to keep certain exempt property necessary to maintain a basic standard of living. Keep in mind, luxury items do not fall into this category. If other debt relief companies tell you that filing bankruptcy means you will lose everything, they’re not telling you the whole story. Congress implemented bankruptcy laws to help the “honest but unfortunate debtor” who fell into more debt than they can reasonably handle, often due to unforeseeable circumstances. Bankruptcy laws are in place to help you get out of debt while, at the same time not taking advantage of creditors. 

Does Missouri Allow The Use Of Federal Bankruptcy Exemptions?

No. If you file bankruptcy in Missouri and you've been a state resident for the last two years, you must use the state's exemptions. You'll also have access to the federal nonbankruptcy exemptions. These can help you protect certain qualifying retirement benefits, death benefits, and veterans’ benefits. 

To use Missouri’s bankruptcy exemptions, you need to have lived in the state for at least 730 days (or two years) before filing your case. This rule helps prevent people from moving to a different state just to take advantage of better exemption laws.

Missouri Bankruptcy Exemptions

Missouri offers a variety of exemptions that help protect your property when you file Chapter 7 bankruptcy. Below, we’ll walk through the key exemptions available for your home, personal property, income, benefits, and more. Understanding what’s protected can help you feel more confident as you move forward.

Real Property Exemptions: Missouri Homestead Exemptions

Missouri allows homeowners to protect up to $15,000 in home equity. If you live in a mobile home that's not attached to land, you can exempt up to $5,000.

The exemption applies to your primary residence and helps prevent it from being sold in bankruptcy—as long as your equity doesn’t exceed the limit. Missouri does not allow this exemption to be doubled for joint filers. However, property owned as tenants by the entirety may be fully protected.

Personal Property Exemptions

Consumers filing bankruptcy in Missouri are allowed to use the wildcard exemption under 513.430.1(3) & 513.440 to exempt any kind of property up to $600. If the filer is the head of a family, they are entitled to an exemption in the amount of $1,250. The filer can also get an extra $350 wildcard exemption for any dependent under age 21 and dependents with a disability. 

• Burial grounds: you can exempt up to $100 or one acre - 214.190 

• Clothing household goods, appliances, furnishings, books, animals, musical instruments and crops; health aids: you can exempt up to $3,000 

• Jewelry: you can exempt a wedding ring or engagement ring up to $1,500; and protect up to $500 for other jewelry. 

• Firearms and ammunition: you can exempt up to $1,500 value.

• Health savings accounts: you can exempt up to the full amount 513.430.1(10)(f) 

• If you have a car you can protect up to $3,000 of value. This means that if you finance or own your vehicle you may be able to keep it. 

• Up to $3,000 for tools of trade and books for your profession.

Other Missouri Exemptions:

• You can keep up to 75% of weekly earned but unpaid wages. Keep in mind that if the 75 percent is less than 30 times the accepted minimum wage amount set by the US guidelines, that will supersede the 75 percent of earnings. 

• The follow tax-exempt retirement accounts are fully exempt: 401(k)s, 403(b)s, profit-sharing, and money purchase plans, SEP and SIMPLE IRAs, IRAS, Roth IRAs, ERISA-IRAs, stock, bonus, pension, annuity, and retirement payments needed for support - 11 U.S.C § 522 & 513.430.1(10)(e) & (f) 

• Retirement Accounts: Public Officers and Employees, city employees, police and highway employees, firefighters, state employees, teachers, and school employees, 

• Wrongful death recoveries reasonably necessary for your support are fully exempt

• Workers' compensation is fully exempt

• Unemployment compensation, Veterans' benefits, social security benefits, crime victims' compensation, and local public assistance are fully exempt

• Disability, illness benefits needed for support; unmatured life insurance policy, life insurance interest, loan value or dividends:

  • You can exempt up to $150,000 of cash value if purchased more than six month- 513.430.1(8) & (10)(e)

  • Fraternal benefit society benefits up to $5,000 but must be bought over six months before filing. - 513.430(10)(c)

• You can exempt up to $15,000 of any matured life insurance proceeds for burial expenses for designated family members. 

• Alimony and Child Support: You can exempt up to $750 per month in alimony and child support payments - 513.430.1(10)(d)

Filing Chapter 7 Bankruptcy 

Knowing which bankruptcy exemptions to use when you file your Missouri bankruptcy case can be very confusing. Many Missouri bankruptcy attorneys that can give you legal advice as to which exemptions would be best. A bankruptcy lawyer will be able to review your case and discuss whether a Chapter 7 bankruptcy or a Chapter 13 bankruptcy would be better for you. A Chapter 7 bankruptcy, eliminates all of your debt and a Chapter 13 bankruptcy, will consolidate your debt into a single monthly payment plan. Most Missouri bankruptcy lawyers you meet with will give you free consultations which you can benefit from. If you don’t think that you will be able to hire an attorney to help you due to a lack of funds, there is no need to worry. Upsolve has free bankruptcy tools and guides to help you file for bankruptcy for free. You can use Upsolve’s tools to learn how to file for bankruptcy step-by-step. This can be a more affordable way to get the debt relief you need.