Bankruptcy exemptions in Vermont: what you can keep
What property Vermont law protects in bankruptcy, item by item.
Checked against official sources: October 25, 2026.
Short answer
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.
- Exemption system
- State or federal, your choice
- Car or other vehicle
- Up to $2,500 total in one or more motor vehicles.
- 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.
- Amounts
- Fixed dollar amounts in the Vermont Statutes as currently published on legislature.vermont.gov (2025-2026 session); not indexed for inflation.
The Vermont exemption list
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.
Retirement money
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)
Retirement money in tax-exempt accounts is protected whichever set of exemptions you use (IRAs subject to the 522(n) cap).
Law: 11 U.S.C. 522(b)(3)(C), 522(d)(12), 522(n)
Keeping your home 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).
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
Law: 27 V.S.A. 101, 105
The 730-day rule
You use the exemption law of the state where you lived (your domicile) for the full 730 days (2 years) before you filed. If you moved between states during those 2 years, you use the law of the state where you lived for the 180 days before that 2-year period, or where you lived the longest part of those 180 days.
Law: 11 U.S.C. 522(b)(3)(A)
If this rule leaves you with no exemptions at all (for example, the state's exemptions apply only to its residents and you no longer live there), you can use the federal exemptions instead.
Law: 11 U.S.C. 522(b)(3), flush language
Choosing a set in Vermont
In some states you can choose either the state exemptions or the federal exemptions. You must pick one whole set; you cannot mix them. Other states allow only the state exemptions. A married couple filing together must both pick the same set.
Law: 11 U.S.C. 522(b)(1)-(2); 11 U.S.C. 522(d)
In nearby states
- Massachusetts: State or federal, your choice. Home (homestead): automatic homestead: $125,000 with no paperwork.
- New York: State or federal, your choice. Home (homestead): depends on the county where the home is: from $102,400 to $204,825.
- Connecticut: State or federal, your choice. Home (homestead): $250,000 of equity in your homestead (owner-occupied home, co-op or mobile manufactured home used as your primary residence), per person claiming it.
- Rhode Island: State or federal, your choice. Home (homestead): $500,000 in the home that you live in or intend to live in as your principal residence.
Steps to protect what you can in Vermont
Make a property list
Write down your home, car, bank accounts, household goods and other property, with a value for each. The form for this is Official Form 106A/B.
Check the exemption list
For each item, find the Vermont exemption that covers it and its limit.
List the exemptions you claim
You claim exemptions on Official Form 106C.
Free legal help in Vermont
Questions about exemptions 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.
How much home equity can I keep 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.
Is there a wildcard in Vermont?
$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.