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Personal Property Exemptions and Bankruptcy in Illinois

Robert J. Adams and Associates Oct. 21, 2020

Often a person is fearful of filing Chapter 7 bankruptcy because he/she/they would lose the personal property. Generally, that is a needless concern. Why? Because there are Personal Property Exemptions.

The following will give a short explanation. But, first, a couple of points to consider:

  1. Used furniture usually has little value. Check a garage sale and you will still how little used furniture is valued. TVs, computers, phones have little resale value.

  2. Personal property also includes cash and funds in a bank.

  3. Married couples filing jointly the exemptions for Personal Property double.

  4. I have a separate video and articles on Homestead Exemption in Illinois

The most frequent Personal Property Exemptions:

  1. Personal Property of all kinds: $4,000. This exemption is also a “wild card” that can be used to supplement many other exemptions that have specific limits. 

  2. Motor vehicles (cars, trucks, motorcycles): $2,400. Value is generally “trade in” value not retail value. The exemption is only good for one car. If there is a second car use the “Wild Card.” If a married couple and each own a car then each get an exemption of $2,400.

  3. Clothing: Necessary wearing apparel is 100% exempt.

  4. Tools of the Trade: $1,500.

  5. Worker’s Compensation: 100% exempt but must be listed.

  6. PERSONAL INJURY CLAIMS. The exemption is $15,000. (For individuals who a large pending case we have separate videos and articles on how to handle your debts.)

  7. PENSION AND RETIREMENT ACCOUNTS. There is a 100% exemption to qualified pensions and retirement benefits. That would include Individual Retirement Accounts (IRA) and 401(k) accounts.

  8. Some other exemptions: There are some other enumerated exemptions but the above cover the vast majority of individuals seeking bankruptcy protection. Some of the remaining exemptions are for medical aids and also for Social Security or public aid benefits.


What if a person’s personal property is over and above allowed exemptions by $1,000 or $2,000? Even the most aggressive trustee will not attempt to sell assets unless the trustee is able to garner at least $2,000 for the benefit of creditors.


The exemptions are the same. If you have personal property in excess of the emptions there are ways of reducing the effects.