What Are the Nevada Bankruptcy Exemptions?

What are the Nevada bankruptcy exemptions and why are they important in a Chapter 7 bankruptcy? 

When you file for Chapter 7 bankruptcy the general idea is that you turn over all of your property to the bankruptcy estate. At that point, your bankruptcy trustee can liquidate your non-exempt property to share among your creditors before you otherwise walk away from your unsecured debts entirely. With the proper use of exemptions, however, you’ll be able to keep most or even all of your possessions despite filing for bankruptcy. Exemptions are laws that allow you to protect your personal property in a bankruptcy case. This allows people to truly achieve a fresh start after filing bankruptcy, by helping to ensure that they can still maintain a decent standard of living. Every state has its own set of exemptions laws and there is a set of federal exemptions contained in the U.S. Bankruptcy Code. Some states allow a filer to choose between state and federal exemptions whereas others only allow for the state option. 

Does Nevada allow the use of federal bankruptcy exemptions?

Nevada has opted out of the federal bankruptcy exemptions. This means that if you file for Chapter 7 bankruptcy in Nevada, presuming you fulfill the residency requirement, you must use the Nevada state exemptions for your bankruptcy case. There is one exception to this, which is if you have lived in Nevada for less than 730 days (two years), you don’t yet qualify to use the Nevada state exemptions. Instead, you’ll need to look back to where you lived during the 180 days before the two years prior to your filing, or roughly two and a half years ago. In either case, you will still have access to the federal nonbankruptcy exemptions in addition to your state exemptions.

Nevada Bankruptcy Exemptions 

If you are married and filing bankruptcy jointly in Nevada then you can double most of the exemptions allowed. This applies to any Nevada state exemption unless it is specifically noted that you can’t do so, such as below in the homestead exemption.  

Real Property - the Nevada Homestead Exemption

Nevada law offers a very generous homestead exemption for those who own their own home,  but it is one of the few Nevada state exemptions that married couples can’t double. Under Nevada exemptions, you can protect up to $605,000 of equity in a home or mobile home. To properly use this exemption, however, you must record a homestead declaration before filing for bankruptcy. Nev. Rev. Stat. § § 21.090(1)(l), (m). 

Personal Property Exemptions

For personal property, Nevada allows married couples filing jointly to double the listed amounts below. This includes household items, keepsakes, and cars for the amounts stated pursuant to  Nev. Rev. Stat. § § 21.090; 689.700, 645A.170, 645B.180.

Motor vehicle: You can protect up to $15,000 of equity in a motor vehicle. If, however, the car has been specifically equipped for someone with a disability, there is no limit to the exemption.

Household goods, furniture, electronics, clothing, equity in appliances, home, and yard equipment:  A Nevada filer can protect up to $12,000 of combined value for these items. Married couples filing jointly can double this amount and protect up to $24,000 in combined value.

Books, art, musical instruments, and jewelry:  You can protect up to $5,000 of combined value for the above items. Married couples can double for up to $10,000 of protection. 

Personal injury award:   If you have received (or are expecting to receive) a personal injury award you can protect up to $16,150. 

The  below personal property items are protected in full:

• Health aids (if medically prescribed.)

• Keepsakes and family photos.

• Burial plot or funeral service money held in trust. 

• Escrow and mortgage impound accounts.

• Collections of metal-bearing ores geological specimens, art curiosities or paleontological remains (these must be arranged, classified, cataloged, and numbered in reference books, Coin collections are not exempt.)

• Victim crime restitution. 

• Income tax refunds from state or federal Earned Income Credit.

• Wrongful death awards to survivors (for the extent needed for support.)

• Future earnings compensation (for the extent necessary for support.) 

Additionally, in Nevada, you also have a wildcard exemption that you can use on any personal property, for up to $10,000 in value. Nev. Rev. Stat. § 21.090(z). This again can be doubled for married couples, up to $20,000.

Miscellaneous Other Personal Property

Nevada bankruptcy exemptions protect the below tools of the trade for various industries up to the amounts stated.

• Farmers can protect up to $4,500 of equity in farm trucks, tools, stock, equipment, and seed. Nev. Rev. Stat. § 21.090(1)(c)

• Miners can protect up to $4,500 of equity in a miner or prospector’s dwelling, working mining claim, cars, tools, and appliances. Nev. Rev. Stat. § 21.090(1)(e).

• For any job that involves arms, uniforms, and accouterments that you are required to keep. Nev. Rev. Stat. § 21.090(1)(i)

• Librarians can protect up to $10,000 in equity in library equipment, tools, inventory, and supplies. Nev. Rev. Stat. § 21.090(1)(d)

Also, particular business partnership property is protected under Nev. Rev. Stat. § 87.250(2c)

Money Benefits

Some property or benefits are funds that you are entitled to keep and therefore are protected within a bankruptcy case. Depending on the specific item it can be protected fully or up to the amounts stated below. 

• Wages and income - you can protect up to 75% of wages or 50 times the federal minimum wage, whichever is greater. Nev. Rev. Stat. § 21.090(1)(g)

• All money growing out of any life insurance Nev. Rev. Stat. § 21.090(1)(k)

• Any funds being held by a landlord as a security deposit. Nev. Rev. Stat. § 21.090(1)(n)

• Any funds for court-ordered child support. Nev. Rev. Stat. § 21.090(1)(s)

• Any funds for court-ordered alimony. Nev. Rev. Stat. § 21.090(1)(t)

• Payments received under the Social Security Act, including retirement and survivor’s benefits, supplemental security income benefits and disability insurance benefits. Nev. Rev. Stat. § 21.090(1)(y)

Insurance

• Insurance proceeds are also protected within a Nevada bankruptcy as indicated below:

• Life insurance policy or proceeds. Nev. Rev. Stat. § 21.090(1)(k) 

• Life insurance proceeds if you are not insured. Nev. Rev. Stat. § 687B.260

• Health insurance proceeds or avails. Nev. Rev. Stat. § 687B.270

• Group life or health policy or proceeds. Nev. Rev. Stat. § 687B.280

• Annuity contract proceeds. Nev. Rev. Stat. § 687B.290 

• Fraternal benefit society benefits. Nev. Rev. Stat. § 695A.220

• Private disability insurance proceeds. Nev. Rev. Stat. § 21.090(1)(ee)

Other Nevada Exemptions

The above exemptions can be found in the Nevada Revised Statutes as indicated above. Nevada state law also protects the below public benefits in full, regardless of whether you have filed for Chapter 7 bankruptcy. These exemptions include: 

Public Benefits

• Aid to blind, aged, disabled, and public assistance. Nev. Rev. Stat. §§ 422.291; 21.090(1)(kk); 422A.325; 615.270

• Worker’s compensation (industrial insurance). Nev. Rev. Stat. §§ 616C.205; 21.090(1)(gg)

• Public assistance for children. Nev. Rev. Stat. § 21.090(1)(ll)

• Unemployment compensation. Nev. Rev. Stat. § 612.710; 21.090(1)(hh)

• Vocational rehabilitation benefits. Nev. Rev. Stat. §§ 615.270; 21.090(1)(jj)

Pensions

The below pensions or retirement plans are protected in full by either Nevada bankruptcy exemptions or the federal nonbankruptcy exemptions:

• 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). 11 U.S.C. § 522 

• IRAS and Roth IRAs to maximum (amount changes).11 U.S.C. § 522(b)(3)(C)(n) 

• Public employee retirement benefits Nev. Rev. Stat. §§ 286.670; 21.090(1)(ii)

Filing Chapter 7 Bankruptcy? 

If you are considering filing for Chapter 7 bankruptcy in Nevada it might be very helpful to speak to a bankruptcy attorney to explore your options. Most bankruptcy lawyers offer a free consultation to prospective clients, which allows you to find out more about the process and whether or not the lawyer is a good fit without committing in advance. A bankruptcy attorney can help explain the local bankruptcy laws and also evaluate your current financial situation to see which Chapter of bankruptcy makes the most sense for you and your financial goals. While a bankruptcy lawyer can be helpful, you do not have to hire one to file for bankruptcy. If you can’t afford an attorney you can check to see if you are a good fit for filing your own straightforward Chapter 7 case with Upsolve’s screener. If that is the case, Upsolve can partner with you, for free, throughout your entire bankruptcy process and give you the tools you need to successfully eliminate your debt.