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What Are the Bankruptcy Exemptions Covered by Arkansas Bankruptcy Law?

Gavel and MalletWhen you file for Chapter 7 Bankruptcy, many of your assets will be placed into a Bankruptcy estate to be liquidated and sold off to pay your creditors. You will only be able to protect certain assets if they can be exempt from the Bankruptcy estate under Arkansas state Bankruptcy laws. Claiming Arkansas Bankruptcy exemptions also affects the terms of a Chapter 13 Bankruptcy payment plan. While Bankruptcy laws are exact, the unique details of every Bankruptcy case never are. Review available exemptions and consult an Arkansas Bankruptcy attorney to discover the best options for your case.


In the state of Arkansas, you have the choice of using state or federal exemption statuses. If you decide to file under state law, the following are some of the most commonly used Arkansas Bankruptcy exemptions:


Arkansas allows a personal property exemption of only $200. This exemption can double to $400 for married couples filing for joint Bankruptcy. The exemption includes equity in your car, electronics, and other personal belongings aside from clothing. The Arkansas Constitution allows you to keep all of your clothing without filing for exemption.


You may exempt a home on a property of 1/4 acre or less in urban areas or 80 acres or less in rural areas. You can protect an additional $2,500 in equity for urban properties up to one acre or rural properties up to 160 acres. For larger properties, the homestead exemption is not available. The same limits apply whether you are single or married, as joint Bankruptcy exemptions cannot be doubled.

As an alternative, you may elect to exempt $800 in equity ($1,250 for married couples) in real or personal property used as residence.


Funds received from workers’ compensation, disability, and unemployment benefits are exempt from your Bankruptcy estate. These benefits are also not calculated as income for a Chapter 13 payment plan.


IRA deposits of up to $20,000 are exempt as long as the deposit is made at least one year prior to filing for Bankruptcy. Pensions for public workers—including police officers, firefighters, and school employees—are also exempt.


Upon filing for Bankruptcy, you will be required to provide detailed financial statements outlining your income, expenses, assets, and liabilities. You will also be able to elect whether to claim the federal or state Bankruptcy exemptions. It’s important to note that assets protected under state law may not be protected by federal law and vice versa. The legal limits on the exemptions are different, but you are free to choose the set of exemptions that gives you the best financial outcome. However, Arkansas does require that you have been a resident of the state for at least two years to claim the state’s exemptions.

To decide which options are best for your specific Bankruptcy case, contact the experienced Arkansas Bankruptcy attorneys at Caddell Reynolds at (800) 889-6944. Schedule a free legal consultation to review your debts, understand your property value, and find exemptions that can aid you in the Bankruptcy process.