Kentucky Bankruptcy Laws
The process of going through bankruptcy is protected by laws at the state and federal levels. These laws are not the same in every state and can be somewhat complicated. Prior to deciding about bankruptcy, make sure you know all the facts about how the laws will affect you. Find answers by speaking with a local bankruptcy lawyer. When you complete the free form on this page, you can get a free case evaluation with a lawyer in your area.
Before filing for bankruptcy in Kentucky, take some time to familiarize yourself with Kentucky bankruptcy laws.
Kentucky Bankruptcy Exemptions
Kentucky has two exemption schemes you can consider. The first protects the following assets:
- Up to $20,200 for your home
- Unmatured life insurance contracts
- Up to $10,775 for your life insurance policy’s loan value
- Payments from a life insurance policy from someone you depended on
- Up to $10,775 for household goods, $575 per item
- ERISA qualified benefits
- Child support or alimony
- Payment for lost earnings
- Up to $1,350 for jewelry
- Health aids
- Up to $3,225 for a vehicle
- Up to $2,025 for tools of the trade
- Up to $1,075 for any property and $10,125 unused homestead exemption
- Up to $20,200 in personal injury payments
- Public compensation or benefits
The second scheme includes the following:
- Up to $5,000 for a residence
- Up to $5,000 for a burial plot
- Up to $2,500 for a vehicle
- Up to $7,500 for personal injury recoveries
- Health aids
- Lost earnings payments
- Wrongful death recoveries from someone you depended on
- Group life insurance proceeds
- Health or disability benefits
- Some retirement plans and pensions
- Life insurance policy with a married woman as beneficiary
- Life insurance proceeds with a creditor exemption in the contract
- Up to $350 per month for annuity contract
- Public assistance or compensation programs
- Alimony or child support
- Business partnership property
- Up to $2,500 for an additional vehicle used for some trades
- Up to $1,000 for library, office equipment, or other necessary equipment for certain trades
- Up to $3,000 for farming equipment or animals
- Up to $300 for non-farmer tools
- 75 percent of unpaid wages
- Up to $1,000 for any other property
Kentucky Chapter 7 Bankruptcy Law
If you can pass the means test you can file Chapter 7 bankruptcy, which eliminates most debts after using up your non-exempt assets. Some debts, like child support or student loans, cannot be eliminated under any form of bankruptcy.
Kentucky Chapter 13 Bankruptcy Law
If you do not qualify for Chapter 7, you will need to file Chapter 13 bankruptcy, which requires you to pay back your debts under a restructured repayment plan. You will have three to five years to pay back your debts under court supervision.
Start a Free Case Evaluation Right Now!
