Bankruptcy in Vermont
In Vermont you choose state or federal exemptions (exemptions are the property the law lets you keep). Your home (homestead): up to $125,000 in value: your home, outbuildings and the land used with it, that you own and use or keep as your homestead.
You file in the U.S. Bankruptcy Court for the District of Vermont.
Checked against official sources: October 25, 2026. · Free letter and checklist ↓
What you can keep in Vermont
Exemptions are the property the law lets you keep. You pick one whole set: the Vermont list or the federal list. You can't mix them.
Law: 11 U.S.C. 522(b)(1)-(2); 11 U.S.C. 522(d)
| What | Vermont exemption | Federal exemption |
|---|---|---|
Home (homestead) | Up to $125,000 in value: your home, outbuildings and the land used with it, that you own and use or keep as your homestead (plus its rents and products). A surviving spouse keeps the homestead free of the deceased spouse's debts that were not charged on it during life. Law: 27 V.S.A. 105; 27 V.S.A. 101, 105 | $31,575 Law: 11 U.S.C. 522(d)(1) |
Car or other vehicle | Up to $2,500 total in one or more motor vehicles. Law: 12 V.S.A. 2740(1) | $5,025 Law: 11 U.S.C. 522(d)(2) |
Household goods and clothing | Up to $2,500 total in household furnishings, goods, appliances, books, clothing, animals, crops and musical instruments for personal or family use. Plus: a wedding ring; other jewelry up to $500; one cooking stove, heating appliances, one refrigerator, one freezer, one water heater, sewing machines; 10 cords of firewood, 5 tons of coal or 500 gallons of oil; 500 gallons of bottled gas; growing crops up to $5,000; some farm animals and equipment; professionally prescribed health aids. Law: 12 V.S.A. 2740(3)-(14), (17) | Household goods: $800 per item, $16,850 total Jewelry for personal or family use: $2,125 Law: 11 U.S.C. 522(d)(3); 11 U.S.C. 522(d)(4) |
Wildcard (any property) | $400 in any property, plus up to $7,000 of the unused part of the vehicle, tools-of-trade, jewelry, household-goods and growing-crops exemptions. Separately, up to $700 in bank deposits. Law: 12 V.S.A. 2740(7), (15) | $1,675 plus up to $15,800 of any unused part of the (d)(1) homestead amount Law: 11 U.S.C. 522(d)(5) |
Tools of your trade | Up to $5,000 total in professional or trade books or tools of your trade or a dependent's trade. Law: 12 V.S.A. 2740(2) | $3,175 Law: 11 U.S.C. 522(d)(6) |
Wages | Outside bankruptcy, 75% of weekly disposable earnings (or 30 times the federal minimum wage, if more) is protected from wage garnishment, and 85% (or 40 times the federal minimum wage) if the debt came from a consumer credit transaction. If you received assistance from the Department for Children and Families or the Department of Vermont Health Access in the last 2 months, no garnishment order can be entered. Law: 12 V.S.A. 3170 | — |
Retirement accounts | Pensions, annuities, IRAs, Roth IRAs, Keogh, SEP and other plans under IRC 401, 403, 408, 408A and 457 are exempt, but only to the extent contributions were tax-deductible or excludable (Roth: within the legal limits), plus their earnings. Contributions made less than one calendar year before you file bankruptcy are not exempt. Law: 12 V.S.A. 2740(16) | No dollar limit (IRAs are capped under 522(n)) Money in traditional and Roth IRAs is protected up to $1,711,975 in total. Law: 11 U.S.C. 522(d)(12); 11 U.S.C. 522(n); 90 FR 8941 |
Public benefits | Unemployment benefits are fully exempt from creditors. Workers' compensation is exempt from creditors, with narrow exceptions in 21 V.S.A. 682. Public assistance payments are protected and do not pass to the bankruptcy trustee. Social Security, veterans and disability benefits are exempt to the extent reasonably necessary to support you and your dependents. Law: 21 V.S.A. 1367; 21 V.S.A. 681; 33 V.S.A. 124; 12 V.S.A. 2740(19)(A)-(C) | Your right to receive Social Security, unemployment, public assistance, veterans' and disability benefits; alimony and support you reasonably need; and certain pension or annuity payments you reasonably need: No dollar limit (some only as much as you reasonably need) Your right to certain payments: crime victim awards, wrongful-death and life-insurance payments for someone you depended on, personal bodily injury payments (not pain and suffering or actual money losses), and payments for lost future earnings: Crime-victim awards: no limit. Personal injury payment: up to $31,575. Others: as much as you reasonably need Law: 11 U.S.C. 522(d)(10); 11 U.S.C. 522(d)(11) |
Other exemptions |
| An unmatured life insurance policy you own (not credit life insurance): No dollar limit Cash value of life insurance: $16,850 Health aids prescribed by a professional for you or a dependent: No dollar limit Law: 11 U.S.C. 522(d)(7); 11 U.S.C. 522(d)(8); 11 U.S.C. 522(d)(9) |
Amounts: Fixed dollar amounts in the Vermont Statutes as currently published on legislature.vermont.gov (2025-2026 session); not indexed for inflation. Homestead last amended 2023, No. 6, eff. July 1, 2023 (amount unchanged at $125,000); 12 V.S.A. 2740 last amended 2001.
Federal amounts: Amounts in effect for cases filed on or after April 1, 2025 (next automatic adjustment due April 1, 2028)
Law: 11 U.S.C. 104; 90 FR 8941-8942
These amounts are per person. If a married couple files one joint case, each spouse can claim the federal exemptions separately.
The means test in Vermont: first step
Official Form 122A-1 compares your household's yearly income with the median income in Vermont. Here are the official medians:
- 1 person$72,461
- 2 people$96,963
- 3 people$114,075
- 4 people$137,583
- Each extra person+$11,100
Applies to cases filed on or after April 1, 2026. 1 = one earner; 2, 3, 4 = people in the household; add = amount added for each person over 4
Where to file in Vermont
You file in the district where you lived (your domicile) for most of the last 180 days; all of Vermont is one district, so every Vermont filer uses the U.S. Bankruptcy Court for the District of Vermont (Burlington clerk's office, hearings in Burlington or Rutland) - see https://www.vtb.uscourts.gov/court-info/court-locations.
Law: 28 U.S.C. 1408
Divisions: One district for the whole state. Clerk's office in Burlington (11 Elmwood Avenue); hearings and creditors meetings are held in Burlington or Rutland depending on whether you live in the northern or southern part of the state.
Clerk's phone: 802-657-6400
Free help in Vermont
Free letter and checklist
Letter: tell a creditor you filed bankruptcy
Notice to a creditor or debt collector with your case number, court, filing date and chapter.
Checklist: what to gather before you file
Income, tax returns, debts, property and budget papers the federal forms ask about, with Vermont's courts.
Bankruptcy in Vermont by topic
Exemptions in Vermont
Home, car, household goods, wildcard and more, with the law for each.
The means test in Vermont
The official median income and the first-step check.
Where to file in Vermont
The bankruptcy courts, divisions, fees and the 341 meeting.
Good to know in Vermont
- Vermont lets you choose either the Vermont exemptions or the federal exemptions, but not a mix of both.
Law: 11 U.S.C. 522(b)
- Retirement money you put in less than one calendar year before you file is not protected by the Vermont retirement exemption. Source: 12 V.S.A. 2740(16).
- Legal Services Vermont and Vermont Legal Aid do not represent people in bankruptcy, but they give free advice to people with low income and may point to reduced-fee lawyers. Source: VTLawHelp.org.
Questions about bankruptcy in Vermont
Can I use the federal bankruptcy exemptions in Vermont?
You can. Vermont lets you choose the state exemptions or the federal exemptions in 11 U.S.C. 522(d). You must pick one whole set.
What is the homestead exemption in Vermont?
Up to $125,000 in value: your home, outbuildings and the land used with it, that you own and use or keep as your homestead (plus its rents and products).
How much of a car can I keep in bankruptcy in Vermont?
Up to $2,500 total in one or more motor vehicles.
Does Vermont have a wildcard exemption?
$400 in any property, plus up to $7,000 of the unused part of the vehicle, tools-of-trade, jewelry, household-goods and growing-crops exemptions. Separately, up to $700 in bank deposits.
What household goods can I keep in Vermont?
Up to $2,500 total in household furnishings, goods, appliances, books, clothing, animals, crops and musical instruments for personal or family use. Plus: a wedding ring; other jewelry up to $500; one cooking stove, heating appliances, one refrigerator, one freezer, one water heater, sewing machines; 10 cords of firewood, 5 tons of coal or 500 gallons of oil; 500 gallons of bottled gas; growing crops up to $5,000; some farm animals and equipment; professionally prescribed health aids.
Are retirement accounts protected in bankruptcy in Vermont?
Pensions, annuities, IRAs, Roth IRAs, Keogh, SEP and other plans under IRC 401, 403, 408, 408A and 457 are exempt, but only to the extent contributions were tax-deductible or excludable (Roth: within the legal limits), plus their earnings. Contributions made less than one calendar year before you file bankruptcy are not exempt.
Are my wages protected in Vermont?
Outside bankruptcy, 75% of weekly disposable earnings (or 30 times the federal minimum wage, if more) is protected from wage garnishment, and 85% (or 40 times the federal minimum wage) if the debt came from a consumer credit transaction. If you received assistance from the Department for Children and Families or the Department of Vermont Health Access in the last 2 months, no garnishment order can be entered.
Where do I file bankruptcy in Vermont?
You file in the district where you lived (your domicile) for most of the last 180 days; all of Vermont is one district, so every Vermont filer uses the U.S. Bankruptcy Court for the District of Vermont (Burlington clerk's office, hearings in Burlington or Rutland) - see https://www.vtb.uscourts.gov/court-info/court-locations.
What is the median income for the means test in Vermont?
For cases filed on or after April 1, 2026: 1 person: $72,461; 2 people: $96,963; 3 people: $114,075; 4 people: $137,583; Each extra person: +$11,100.
Where can I get free help with bankruptcy in Vermont?
Legal Services Vermont and Vermont Legal Aid (VTLawHelp.org) - free advice for people with low income on whether bankruptcy is right for them and Vermont Bar Association Lawyer Referral Service.