Will I lose anything when filing for bankruptcy - Ohio bankruptcy exemptions

One of the most concerning questions in bankruptcy is whether you will lose anything when you file. Luckily, the State of Ohio has enacted many exemptions that will help protect your property.

The first thing to explain the concept of a Chapter 7 value. The Chapter 7 value looks at the value of the property, minus any liens, minus any exemptions, and minus 10% for potential selling costs.

Let's looks at a hypothetical situation with these facts: A property item with value of $15,000, a lien of $5,000, and exemptions of $5,000. After subtracting the lien and exemptions from the value, $5,000 of equity remains. Then $1,500 of selling costs needs to be subtracted (10% of the full $15,000 of value). This leaves $3,500 in unexempt (or unprotected) equity.

The unexempt equity is treated differently in a Chapter 7 than in a Chapter 13.

In a Chapter 7, you can either surrender the property or pay to keep it.
If you surrender the property, the trustee will sell the property. After the sale, you will receive a check for up to the amount of your exemptions. So, in the hypothetical situation, you would receive a check for up to $5,000. If the property sells for less, then you would receive a lower amount. Any amount remaining after paying off the lien and the exemption check will be used to pay the trustee for their service and the remaining balance will go to your creditors.

If you pay to keep it, you can make a deal with the trustee or do a redemption with a redemption company. If you make a deal with the trustee, you would look to propose an offer to pay off the Chapter 7 value over the course of up to one year. So, in the hypothetical situation, you would offer to pay the $3,500 over up to a year, so roughly $291.67 a month. The trustee may counter with fewer months or to use a tax return to help pay. With a redemption you would look to take out a secured loan to immediately pay off the Chapter 7 value. The benefits of the trustee deal are that there is no interest and you are finished paying faster. The benefits of the redemption are that the payments are likely to be lower, and your bankruptcy case can close faster.

In a Chapter 13, the exempt equity just needs to be paid back to your non-priority unsecured creditors over the course of the Plan. So, in the hypothetical situation, $3,500 would need to be paid to your non-priority unsecured creditors over the course of the Plan.

Now that you understand the concept of a Chapter 7 value, let's look at the common exemptions that are available in Ohio as of June 2025.

HOMESTEAD EXEMPTION:
The homestead exemption protects $182,675 in equity per person on the deed. This only applies if the debtor or the debtor's dependent(s) lives in the home.

MOTOR VEHICLE EXEMPTION:
The motor vehicle exemption protects $5,025 in equity per person for up to one vehicle.

RETIREMENT EXEMPTION:
The retirement exemption fully protects the value of qualified retirement accounts. 401(k), 403(b), and OPER accounts are some examples of qualified retirement accounts. Mutual funds that will be used for retirement doe not count.

MONEY EXEMPTIONS:
The wage exemption protects 75% of all wage funds. The cash exemption protects $625 in physical cash, funds in a bank account, and tax refunds. The social security exemption protects all social security funds. The VA benefits exemption protects all VA benefit funds.

WILDCARD EXEMPTION:
The wildcard exemption protects $1,675 for any property.

There are other exemptions available as well, these are just the most common exemptions. Click on our Contact tab to fill out our bankruptcy contact form so we can be in touch to show you how bankruptcy can help you out.