Massachusetts Bankruptcy Laws
State and federal laws protect the process of going through bankruptcy. These laws vary according to state and can be somewhat complex. Prior to making a decision about bankruptcy, be certain you know all the facts about how the laws in your state will apply to you. Find answers by speaking with a local bankruptcy lawyer. Complete the free form below to get a free case evaluation with a lawyer in your area.
Before filing bankruptcy in Massachusetts, make sure you understand the protections you receive under Massachusetts bankruptcy laws.
Massachusetts Bankruptcy Exemptions
The state of Massachusetts follows two exemption schemes. The first, the federal exemptions, allow debtors to keep the following:
- Up to $20,200 for your home
- Life insurance payments you receive from someone you depended on, like a parent
- Up to $20,200 for personal injury compensation
- Wrongful death, crime victims’ compensation, or public benefits or compensation
- ERISA qualified benefits and retirement benefits
- Up to $10,775 in a loan value life insurance policy
- Up to $10,775 for household goods, $550 per item
- Alimony or child support
- Life insurance contract that has not matured
- Up to $3,225 for a vehicle
- Up to $1,350 for jewelry
- Health aids
- Lost earnings payments
- Up to $20,200 for tools of the trade
- Up to $1,075 for any property as a wild card
- Up to $10,125 of the value of unused homestead exemption, applied toward other property
Married couples who are facing bankruptcy may double these exemptions.
The Massachusetts exemptions are as follows:
- Your home, provided equity is less than $500,000
- Your car, provided equity is less than $700
- Up to $3,000 for household furniture
- Clothes, bedding, bed, heating unit, and $75 per month for utilities
- Two cows, two pigs, 12 sheep and four tons of hay
- Up to $200 for a family library
- Up to $300 for food or consumables or money to buy them
- Church pew, tombs, burial plots
- Up to $500 in value for fishing supplies, including boats, for commercial fishermen
- Up to $200 for a sewing machine
- Military uniforms/equipment
- Business partnership property
- Retirement, ERISA qualified pension benefits
- Public employee pensions
- Up to $400 per week for disability benefits
- Other public benefits
- Medical malpractice self-insurance
- Up to $125 in cash, bank accounts, or wages per pay period
- Up to $500 in deposits in bank
- $200 per month for rent if renting
- Up to $100 for share in cooperative associations
- Proceeds or cash value from life or endowment policy
- Life insurance policy with creditor clause
Massachusetts Chapter 7 Bankruptcy Law
Those who have few debts that cannot be removed and pass the means test may wish to file Chapter 7 bankruptcy, which typically eliminates most debts after selling the non-exempt assets.
Massachusetts Chapter 13 Bankruptcy Law
Chapter 13 bankruptcy protection gives the debtor the chance to attempt to pay back the debt under court supervision. This can protect some assets and gives those who do not qualify for Chapter 7 an option to consider.
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