What Are the Connecticut Bankruptcy Exemptions?

Bankruptcy exemptions are laws that protect an individual’s property in a bankruptcy. Exemption laws exist in the Bankruptcy Code and in State law, and the exemptions in state law protect a person’s property from creditors even when no bankruptcy case is filed. Filing for bankruptcy helps in erasing bills while keeping retirement accounts intact. 

Bankruptcy Exemptions

Connecticut Bankruptcy Law: Exemptions That Assist Protect Lenders

Connecticut is one of the states that allow residents to choose between using its unique exemptions or federal exemptions. One likewise has the choice in Connecticut to get federal exemption statutes instead of the Connecticut bankruptcy exemptions, and it is likewise possible to utilize federal additional exemptions in conjunction with the Connecticut exemptions. There are certain exemptions connected to the Connecticut bankruptcy law that helps secure creditors when a debtor submits bankruptcy in Connecticut. An individual can file an exemption on their:

  • Homestead for up to $75,000, thus safeguarding equity in their primary residence. 
  • Personal property such as spendthrift trust funds, clothing, food, and a $1,000 wildcard exemption
  • Vehicles for up to $3,500
  • 75% of earned wages or 40 times federal or state minimum wage, whichever is higher
  • Pension or retirement for teachers, state employees, and medical savings covered. 
  • Disability insurance benefits, child support, and interest accrued under an unmatured life insurance that is contract owned by the debtor. 

Items that are exempt under Connecticut bankruptcy law include: 

  • Individual effects
  • Furnishings
  • Automobiles (subject to a defined amount of equity) 
  • Tools of trade
  • Equity in a home
  • Clothing
  • Family items 
  • Books
  • Fashion jewelry.

Filing Bankruptcy in Connecticut

Filing for bankruptcy in Connecticut is similar to other states, and the process falls under federal law in Connecticut. Customers can declare bankruptcy under Connecticut bankruptcy law either as Chapter 7 bankruptcy or Chapter 13 bankruptcy. With brand-new federal bankruptcy exemption laws entering into effect from October 17, 2005, a “means test” will figure out whether the debtor is qualified for Chapter 7 bankruptcy. For those that do not get Chapter 7 bankruptcy, the best and only alternative will be the Chapter 13 bankruptcy.

Filing Bankruptcy in Connecticut

 It ought to not be difficult to locate a Connecticut bankruptcy law lawyer, because there are a variety of them that specialize in offering service to all kinds of clients. Individuals can get reliable counsel throughout Connecticut that handles unanticipated medical costs, divorce or joblessness that can capture people off guard and lead to bankruptcy. An excellent Connecticut bankruptcy law lawyer will be able to aid in making the very best choice in all matters relating to filing bankruptcy. A bankruptcy attorney helps people to:

  • Determine the right time to file
  • Determine what property to keep
  • Qualify for the chapter of their choice
  • Ensure they do not face punishment for fraudulent activities

Whether it is consumer, business or industrial bankruptcy, debtors will require a Connecticut bankruptcy law lawyer with substantial experience in understanding all the intricacies of the laws relating to Connecticut bankruptcy. Remember however, that there is no magic formula to help make the choice to submit bankruptcy. A debtor may think about bankruptcy as an option if they are paying minimum quantities on expenses, get a notification that a home loan or loan is being foreclosed on or they have actually had serious monetary setbacks. The case starts when an individual files the paperwork with a local bankruptcy court, pays the filing fee, or requests a fee waiver. 

Debtors do not Necessarily Lose Everything in Bankruptcy

Lots of people are under the false impression that bankruptcy means losing everything that the debtor owns in order to satisfy his/her debt. As a matter of truth, the Connecticut bankruptcy law enables debtors to keep a number of things that are essential for the wellbeing of the debtor and his family. In spite of the fact that there is a federal exemption law, Connecticut bankruptcy law allows you to choose between state and federal exemption laws.

Connecticut Chapter 7 Bankruptcy 

Chapter 7 is a liquidation bankruptcy that helps filers to take control of their debt and eliminate unsecured debts such as credit card debt. This process is fairly quick and affordable and is appropriate for individuals whose property consists of essential work and living items. However, unlike Chapter 13 bankruptcy, there is no payment plan option to help catch up with late car or mortgage payments, so they can lose valuable property if they are behind when they file. 

Connecticut Chapter 13 Bankruptcy 

The filer proposes a 3-5 year repayment plan to his creditors to offset all or part of their debt from the filer’s future income. Although it is an expensive process, an individual can use Chapter 13 to pay back taxes, retain valuable non-exempt property, and resolve missed mortgage or car payments. Honoring the repayment agreement ensures that all remaining dischargeable debts will be released once the term of the plan is completed. 

Connecticut Homestead Exemptions 

Connecticut bankruptcy law allows a person to exempt $75,000 of equity in a principal place of residence, and individuals who are married and file jointly get an exemption of up to $150,000. 


Bankruptcy exemptions play a critical role in Chapter 7 and Chapter 13 bankruptcy, so individuals must know what property is exempt in Connecticut. Connecticut’s exemptions differ from federal exemptions, and citizens have an advantage of being able to choose which exemption they will use.  Ultimately, exemptions allow individuals to erase their bills and retain critical retirement accounts. 

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