Michigan Bankruptcy Exemptions — What You Keep
What property you can protect when filing for bankruptcy in Michigan — homestead, personal property, vehicle, wage, and retirement exemptions.
Michigan's exemption system
Michigan allows debtors to choose between state exemptions and the federal bankruptcy exemptions under §11 U.S.C. § 522(d). An attorney can help determine which set protects more of your property.
Key Michigan exemptions
Homestead §600.5451(1)(m)
$30,000 statutory base ($45,000 if the debtor or a dependent is 65 or older or disabled), adjusted every 3 years by the state treasurer for inflation. Applies to a homestead the debtor or a dependent occupies as a principal residence. Under MCL 600.5451(1), a Michigan debtor may instead exempt property that is exempt under federal law. Michigan also has a constitutional homestead exemption that protects up to $3,500 under Art. X, § 3, but the statutory bankruptcy exemption is higher. This protects equity in your primary residence — if your home equity is within this limit, you keep the house in bankruptcy.
Personal property §600.5451(1)(c)
$3,000 in household goods, furniture, appliances, and jewelry; $450 per item limit (adjusted periodically). This covers household goods, furnishings, clothing, and everyday personal items.
Vehicle §600.5451(1)(o)
$3,775 in equity. This protects equity in your car — meaning the value of the vehicle minus what you owe on it.
Wages §600.5311
60% of earned but unpaid wages, but not less than $15/week, plus $2/week per dependent, if a householder with a family; otherwise 40%, but not less than $10/week. This applies to wages already earned but not yet paid at the time of filing.
Wildcard §600.5451(1)(l)
$1,350 (any property not otherwise exempt). A wildcard exemption can be applied to any property not fully covered by other exemptions.
Retirement accounts §600.5451(1)(g)
ERISA-qualified plans, IRAs, Michigan Public School Employees' Retirement System (MPSERS), and state employee pensions are exempt. Retirement accounts receive strong protection in bankruptcy — both under state law and federal law §29 U.S.C. § 1056 (ERISA).
Tools of trade §600.5451(1)(d)
$2,775 in tools, implements, materials, stock, apparatus, and professional library. This protects the equipment you need to earn a living.
Michigan exemption comparison
| Homestead | Personal property | Wildcard | |
|---|---|---|---|
| What it protects | Equity in your primary residence §11 U.S.C. § 522 | Household goods, furnishings, clothing §11 U.S.C. § 522 | Any property not covered by other exemptions §11 U.S.C. § 522 |
| Michigan limit | $30,000 statutory base ($45,000 if the debtor or a dependent is 65 or older or disabled), adjusted every 3 years by the state treasurer for inflation §600.5451(1)(m) | $3,000 in household goods, furniture, appliances, and jewelry; $450 per item limit (adjusted periodically) §600.5451(1)(c) | $1,350 (any property not otherwise exempt) §600.5451(1)(l) |
| Key limitation | Primary residence only — not investment property §11 U.S.C. § 522 | Individual item and aggregate caps may apply §11 U.S.C. § 522 | Total cap across all wildcard-claimed property §11 U.S.C. § 522 |
| Strategic value | Can be the largest exemption | Protects everyday necessities | Fills gaps left by specific exemptions |
How exemptions affect chapter choice
- In Chapter 7, non-exempt property can be liquidated by the trustee. High exemptions mean you keep more.
- In Chapter 13, the "best interests of creditors" test means your plan must pay unsecured creditors at least what they would have received if non-exempt assets were liquidated in Chapter 7. Higher exemptions can reduce your required plan payment.
Common exemption planning considerations
- Is your home equity within the homestead limit, or does it exceed the cap?
- Do you have a vehicle loan that reduces your equity below the exemption?
- Are there assets that could be reclassified or converted to exempt form before filing?
- Would waiting to file change the exemption calculation (e.g., recent large deposit, bonus, tax refund)?
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Frequently Asked Questions
General answers to common questions. Specific outcomes depend on your facts and timing.
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Related guides
- $30,000 statutory base ($45,000 if the debtor or a dependent is 65 or older or disabled), adjusted every 3 years by the state treasurer for inflation
- Applies to a homestead the debtor or a dependent occupies as a principal residence. Under MCL 600.5451(1), a Michigan debtor may instead exempt property that is exempt under federal law. Michigan also has a constitutional homestead exemption that protects up to $3,500 under Art. X, § 3, but the statutory bankruptcy exemption is higher.
- $3,000 in household goods, furniture, appliances, and jewelry; $450 per item limit (adjusted periodically)
- 60% of earned but unpaid wages, but not less than $15/week, plus $2/week per dependent, if a householder with a family; otherwise 40%, but not less than $10/week