Chapter 7 Bankruptcy in Indiana: Exemptions and Court Locations - National Bankruptcy Forum (2023)

Chapter 7 Bankruptcy in Indiana: Exemptions and Court Locations - National Bankruptcy Forum (1)If you don’t live in or near Indiana, you may only have a vague picture of a state with miles of farmland that hosts the annual Indianapolis 500 auto race. In fact, Indiana is filled with attractions and boasts diverse industries.

A discussion of Indiana’s charms would not be complete without a mention of Brown County, a destination spot where tourists stay days at a time for theater, musical events, hiking and boutique-hopping. Some prefer to visit Indiana’s historical sites, including the Benjamin Harrison Presidential Site and the Connor Prairie Interactive History Park, which reconstructs an 1836 prairie town. And for relaxation, Indiana has a great outdoor scene, like Marengo Cave and the Indiana Dunes State Park.

On the economic side, Indiana was ranked 35th for per capita personal income (PCPI) at $43,492, which is 88% of the national average, in 2016. However, the PCPI grew 3.6% from 2015 to 2016, which is a greater increase than the national average of 2.9%.The largest industry in the state is durable goods manufacturing, which makes up 16% of Indiana’s GDP. However, this industry only saw a 0.5% grow from 2015 to 2016.

Of course, as in the rest of the nation, many in Indiana find it necessary to file bankruptcy. Nearly 23,000 residents filed bankruptcy in 2016, according to statistics from the Northern and Southern districts.

Let’s explore what you need to know about bankruptcy exemptions if you are one of these filers in Indiana.


  • The Basics of Chapter 7 Bankruptcy in Indiana
  • Indiana Bankruptcy Exemptions: Can I keep my property?
  • Indiana Bankruptcy Exemptions
    • Indiana Homestead Exemption
    • Insurance Benefits
    • Motor Vehicles
    • Pension and Retirement Benefits
    • Personal Property
    • Unemployment and Workers’ Compensation
    • Wages
    • Wildcard Exemption
  • Indiana Bankruptcy Courts: Where are they located?
    • Northern District
    • Southern District
(Video) Bankruptcy Checklist for Indiana Residents

The Basics of Chapter 7 Bankruptcy in Indiana

When an individual files for bankruptcy, it’s usually under Chapter 7,which is liquidation bankruptcy, rather than under Chapter 13, whichis reorganization bankruptcy. Chapter 7 bankruptcies are primarily governed by federal law under Title 11 of the U.S. Code. If you are filing under Chapter 7, you need to know that a bankruptcy trustee may sell some of your property in order to help pay your debts. However, some property is exempt, and thus safe from the bankruptcy trustee.

In order to come out of a Chapter 7 bankruptcy in the best position possible, therefore, you must be very clear what property is exempt and therefore safe, and what property is non-exempt and subject to sale by the bankruptcy trustee. Some laws put a value limit on the extent to which your property may be exempt. This limit applies to your equity in the property rather than the value of the property in its entirety.

Filing for bankruptcy is a big step. If you are considering it, it would be wise to contact an Indiana bankruptcy attorney to discuss your options.

Indiana Bankruptcy Exemptions: Can I keep my property?

The U.S. Bankruptcy Code provides a list of exemptions, but each state can also establish their own list of exemptions. Now here’s the key: some states allow filers to choose whether to use the federal or state exemptions, and others insist that filers use the state exemptions. These latter states are known as “opt-out” states, and this is where Indiana falls. If you file in Indiana, you must use the Indiana bankruptcy exemptions and may not use the federal exemptions — except for some specific federal exemptions that you may use in conjunction with the state exemptions.

If you are married and file a joint bankruptcy with your spouse, you can double the exemption amount for any property as long as you both have an ownership interest.

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Let’s take a look at some of the important Indiana exemptions. Please note that these amounts may change regularly, so it’s important to consult with an Indiana bankruptcy attorney before you file to determine your best use of exemptions.

Indiana Bankruptcy Exemptions

The top 5 exemptions under Indiana state law.

Type of exemptionIndiana law
Homestead$19,300, doubled if married
Personal propertyIntangible personal property up to $400, plus health aids; a $10,250 wildcard exemption can be applied to any tangible personal property or nonresidential real estate
VehicleNone, but filers can apply the wildcard exemption
Wages75% of earned but unpaid disposable weekly income, or 30 times the federal hourly minimum wage
Pension/retirementThe portion the filer contributed to his or her retirement account is exempt; public employee pensions plus benefits for lawmakers and teachers also are exempt

Indiana Homestead Exemption

Under Ind. Code §34-55-10-2(c)(1), Indiana gives you a homestead exemption in the amount of $19,300 for your home or principal residence. This can be doubled for married filers. Any interest in real estate held as a tenant by the entirety also is exempt, unless both owners are bankrupt.

Insurance Benefits

Fraternal benefit society benefits are 100% exempt under Ind. Code § 27-11-6-3.

Life insurance policies that name the insured spouse, children and dependent relatives are exempt under Ind. Code §§ 27-1-12-14; 27-1-12-29, 27-2-5-1; 27-8-3-23.

Motor Vehicles

There is no motor vehicle exemption in Indiana. However, you can use the wildcard exemption (addressed below) to protect your car.

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Pension and Retirement Benefits

  • Retirement plans for the portion the debtor contributed are exempt under IC 34-55-10-2(c)(6)
  • Pensions for public employees are exempt under Ind. Code § 5-10.3-8-9.
  • Benefit plans for legislators and retirement benefits for teachers are exempt under Ind. Code §§ 2-3.5-4-11; 2-3.5-5-9; 5-10.3-8-9; 5-10.4-5-14.
  • Pension fund for firefighters and police are exempt under Ind. Code §§ 36-8-7.5-19; 36-8-7.5-22.

Personal Property

You are allowed to exempt intangible personal property up to $400 under Ind. Code § 34-55-10-2. All health aids are exempt under Ind. Code § 34-55-10-2(c)(3).

Unemployment and Workers’ Compensation

Unemployment compensation benefits are exempt until received by the debtor under Ind. Code § 22-4-33-3. All workers’ compensation benefits are exempt except for child support claims under Ind. Code § 22-3-2-17.


Indiana’s wage garnishment law (Ind. Code Ann. § 24-4.5-5-105) is a minimum 75% of earned but unpaid weekly disposable earnings, or 30 times the federal hourly minimum wage. A judge may authorize a higher amount for low-income earners.

Wildcard Exemption

Indiana gives you a wildcard exemption you can use for any tangible personal property or nonresidential real estate up to $10,250 under Ind. Code §34-55-10-2(c)(2).. As previously mentioned, this may be used for a motor vehicle.

Indiana Bankruptcy Courts: Where are they located?

Most people who file for bankruptcy don’t need to attend court or appear in front of a judge. However, they may need to if a bankruptcy trustee objects to one of their exemptions.

In Indiana, the bankruptcy courts are divided into two districts: Northern and Southern. Click each link below to find out where you may file for Chapter 7 bankruptcy in Indiana.

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Northern District

Fort Wayne: Ross Adair Federal Building and United States Courthouse, Room 1188, 1300 S. Harrison St., Fort Wayne, IN 46802-3435, Phone: (260) 420-5100

Hammond: United States Bankruptcy Court, Northern District of Indiana, Room 2200, 5400 Federal Plaza, Hammond, IN 46320, Phone: (219) 852-3480

Lafayette: Charles A. Halleck Federal Building, 230 North Fourth St., Room 105, Lafayette, IN 47901-1322, Phone: (765) 420-6300

South Bend:Robert K. Rodibaugh United States Bankruptcy Courthouse, 401 S. Michigan St., South Bend, IN 46601-2304, Phone: (574) 968-2100

Southern District

Evansville: Winfield K. Denton Federal Building & United States Courthouse, 101 NW Martin Luther King Jr. Blvd., Evansville, IN 47708, Phone:(812) 434-6470

Indianapolis: Birch Bayh Federal Building and United States Courthouse, 46 E. Ohio St., Room 116, Indianapolis, IN 46204, Phone:(317) 229-3800

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New Albany: Lee H. Hamilton Federal Building & United States Courthouse, 121 W. Spring St., New Albany, IN 47150, Phone:(812) 542-4540

Terre Haute: United States Courthouse, 921 Ohio St., Terre Haute,IN 47807,not staffed


What assets are exempt from creditors in Indiana? ›

Under Indiana law, there are three main exemptions:
  • Homestead exemption.
  • Personal property exemption.
  • And general intangible exemption.

What assets are protected in bankruptcy in Indiana? ›

Indiana bankruptcy exemptions include several items of personal property:
  • Intangible personal property up to $400.
  • All health aids.
  • Education savings accounts (depending on when the contributions were made).
  • Money in medical or health savings accounts.
  • Spendthrift trust assets.
  • Military uniforms, equipment, and guns.
Apr 3, 2020

How much cash can you keep when filing Chapter 7 in Indiana? ›

In Indiana, the maximum amount of money that can be protected in a checking or savings account is $400 if you filing bankruptcy on your own, or $800 if you are filing as a married couple. In theory, any cash over these amounts can be taken by the trustee.

What assets can be seized in Chapter 7? ›

What Assets are NOT Exempt in Chapter 7?
  • Additional home or residential property that is not your primary residence.
  • Investments that are not part of your retirement accounts.
  • An expensive vehicle(s) not covered by bankruptcy exemptions.
  • High-priced collectibles.
  • Luxury items.
  • Expensive clothing and jewelry.

What personal property Cannot be seized? ›

All states have designated certain types of property as "exempt," or free from seizure, by judgment creditors. For example, clothing, basic household furnishings, your house, and your car are commonly exempt, as long as they're not worth too much.

What bank accounts Cannot be garnished? ›

In many states, some IRS-designated trust accounts may be exempt from creditor garnishment. This includes individual retirement accounts (IRAs), pension accounts and annuity accounts. Assets (including bank accounts) held in what's known as an irrevocable living trust cannot be accessed by creditors.

What are 5 types of debt that are not dischargeable in bankruptcy? ›

Non-Dischargeable Debt in Bankruptcy
  • Debts left off the bankruptcy petition, unless the creditor actually knew of the filing.
  • Many types of taxes.
  • Child support or alimony.
  • Debts owed to a child or ex-spouse arising from divorce or separation.
  • Fines or penalties owed to government agencies.
  • Student loans.
Oct 18, 2022

What expenses Cannot be discharged in bankruptcy? ›

No matter which form of bankruptcy is sought, not all debt can be wiped out through a bankruptcy case. Taxes, spousal support, child support, alimony, and government-funded or backed student loans are some types of debt you will not be able to discharge in bankruptcy.

Can I keep my car if I file Chapter 7 in Indiana? ›

As long as the equity (or how much value you actually own beyond loans and mortgages) of your house and cars do not exceed Indiana's limits for their Bankruptcy Exemptions, you can keep your house and cars.

Can I put money in savings while in Chapter 7? ›

You can keep cash in Chapter 7 bankruptcy if it qualifies as an exempt asset under bankruptcy exemption laws. You don't have to give up everything when you file for bankruptcy. You can keep any property that qualifies as an exempt asset—including cash.

Do they freeze your bank account when you file Chapter 7? ›

Do they freeze your bank account when you file Chapter 7? Generally, no. Especially if the full amount in the account is protected by an exemption. Some banks (most notably, Wells Fargo) have an internal policy of freezing bank accounts with a balance over a certain amount once they learn about a bankruptcy filing.

Can I buy a car in cash after Chapter 7? ›

While you can purchase a car after bankruptcy, you should expect to pay a higher interest rate if you take out a loan. Although waiting for your credit score to improve can lower your rate, it's not always possible.

What do you lose when you file Chapter 7? ›

Chapter 7 bankruptcy erases or "discharges" credit card balances, medical bills, past-due rent payments, payday loans, overdue cellphone and utility bills, car loan balances, and even home mortgages in as little as four months.

How much cash can I have in Chapter 7? ›

If you declare bankruptcy, will you lose literally every dollar that you have in your savings? The answer is no: some cash can be exempted in a Chapter 7 case. For example, typically under Federal exemptions, you can have approximately $20,000.00 cash on hand or in the bank on the day you file bankruptcy.

What debts Cannot be included in Chapter 7? ›

Generally speaking, in a Chapter 7 proceeding, the following types of debts are not discharged:
  • Debts that were not listed at the start of the case (or debts for unlisted creditors). ...
  • Most student loans (unless repayment would cause the debtor and their dependents undue hardship)
  • Recent federal, state, and local taxes.
Apr 7, 2021

What personal property can be seized in a Judgement in Indiana? ›

And some states also allow judgment liens on the debtor's personal property -- things like jewelry, art, antiques, and other valuables. In Indiana, a judgment lien can be attached to either real estate or personal property.

When can the sheriff take your stuff? ›

The sheriff is specifically authorized to demand from the debtor the amount as per the warrant, and if the debtor cannot pay the amount in cash, the sheriff if authorized to take any movable assets that he or she finds on the premises, into attachment.

How to hide money from creditors? ›

Seven Ways to Protect Your Assets from Litigation and Creditors
  1. Purchase Insurance. Insurance is crucial as a first line of protection against speculative claims that could endanger your assets. ...
  2. Transfer Assets. ...
  3. Re-Title Assets. ...
  4. Make Retirement Plan Contributions. ...
  5. Create an LLC or FLP. ...
  6. Set Up a DAPT. ...
  7. Create an Offshore Trust.
Aug 18, 2022

How do you get around a bank garnishment? ›

  1. Pay your debts if you can afford it. Make a plan to reduce your debt.
  2. If you cannot afford to pay your debt, see if you can set up a payment plan with your creditor. ...
  3. Challenge the garnishment. ...
  4. Do no put money into an account at a bank or credit union.
  5. See if you can settle your debt. ...
  6. Consider bankruptcy.

Can debt collectors see your bank account balance? ›

Can debt collectors see your bank account balance or garnish your wages? Collection agencies can access your bank account, but only after a court judgment.

Can a creditor take all the money in your bank account? ›

If a debt collector has a court judgment, then it may be able to garnish your bank account or wages. Certain debts owed to the government may also result in garnishment, even without a judgment.

What debt is not forgiven in straight bankruptcy? ›

Debts Never Discharged in Bankruptcy

Alimony and child support. Certain unpaid taxes, such as tax liens. However, some federal, state, and local taxes may be eligible for discharge if they date back several years. Debts for willful and malicious injury to another person or property.

Which bankruptcy eliminates most debts? ›

Chapter 7 Bankruptcy Discharge Wipes Out Most Debts Forever

credit card debt. medical bills. personal loans and other unsecured debt.

What debt is not eligible for bankruptcy forgiveness? ›

The most common types of nondischargeable debts are certain types of tax claims, debts not set forth by the debtor on the lists and schedules the debtor must file with the court, debts for spousal or child support or alimony, debts for willful and malicious injuries to person or property, debts to governmental units ...

What are 2 kinds of debt that are not dischargeable in bankruptcy? ›

What Is Nondischargeable Debt? Nondischargeable debt is a type of debt that cannot be eliminated through a bankruptcy proceeding. Such debts include, but are not limited to, student loans; most federal, state, and local taxes; money borrowed on a credit card to pay those taxes; and child support and alimony.

Can I keep credit cards in Chapter 7? ›

You'll likely have to give up all of your credit cards if you file for Chapter 7 bankruptcy, but you can start rebuilding your credit once your case is closed. If you file for Chapter 7 bankruptcy and are hoping to hang onto one of your credit cards, you will likely be out of luck.

What are three types of debt that are not forgiven under Chapter 7 bankruptcy? ›

Debts not discharged include debts for alimony and child support, certain taxes, debts for certain educational benefit overpayments or loans made or guaranteed by a governmental unit, debts for willful and malicious injury by the debtor to another entity or to the property of another entity, debts for death or personal ...

How soon after Chapter 7 can I get a car loan? ›

After you submit your petition, the trustee will review the filing and schedule your meeting of creditors. This is usually around a month after your filing date, but it could be longer. Then, you will wait about 60 days further for the full discharge. After this occurs, you can buy a car immediately, if necessary.

How easy is it to get a car after Chapter 7? ›

Qualifying for a car loan after bankruptcy is doable, but it can take a little more work than buying a car when in good financial standing. The key to qualifying for a car loan after bankruptcy is to improve your credit score and save for a solid down payment.

Can I keep my tax refund after filing Chapter 7? ›

Tax refunds can become complicated during a Chapter 7 bankruptcy. However, the bottom line is that your bankruptcy trustee will likely take a portion or all of your annual tax refund as part of the bankruptcy estate and use it to pay your creditors.

What property is exempt in Indiana? ›

Indiana Homestead Exemption

You can protect up to $19,300 of equity in real estate or tangible personal property. Indiana's homestead exemption applies to residential property or tangible personal property (such as a mobile home) that constitutes your personal or family residence.

What assets can be seized to pay off creditors? ›

Assets that credits can seize include:
  • Bank accounts.
  • Investment accounts.
  • Inheritances.
  • Assets owned by your spouse.
  • Personal homes (different from state to state)
  • Rental properties.
  • Vehicles.
  • Business equipment.
Dec 2, 2022

What accounts are protected from creditors? ›

This creditor protection can be a valuable tool in the event of a legal liability, personal injury lawsuit, or bankruptcy. Accounts that receive special protection include 401(k) plans, pension plans, profit sharing accounts, SEP IRAs, SIMPLE IRAs, 403(b) plans, 457 plans, traditional IRAs, and Roth IRAs.

How long before a debt becomes uncollectible in Indiana? ›

In Indiana, the statute of limitations by judgment is ten years, but it can be renewed, further extending the collection period. This means once a creditor makes a charge against the debtor, the judgment is collectible for up to ten years.

Which property can be attached before judgement? ›

All sealable property can be attached i.e. lands, goods, money, cheques, promissory notes, government securities, buildings debts and all other belongings of the judgement debtor may be attached and sold in execution of a decree against him by the Court.

How do I avoid paying a civil judgement? ›

There are four main ways to not pay a judgment: (1) use statutory exemptions, (2) use protected assets, (3) negotiate with the creditor, or (4) file bankruptcy.

What is an example of exempt property? ›

Exempt property is any property that creditors cannot seize and sell in order to satisfy debt during chapter 7 or chapter 13 bankruptcy. The type of property exempted differs from state to state but often includes clothes, home furnishings, retirement plans, and small amounts of equity in a house and car.

What assets are exempt? ›

Exempted Assets: Assets which are not considered as a part of wealth for the computation of wealth tax. Property held under trust/ for the purpose of charitable/religious purposes. Interest in coparcenary property of Hindu Undivided family. Jewellery in possession of ruler not being his personal property.

What is the homestead exemption in Indiana for Chapter 7? ›

Code §34-55-10-2(c)(1), Indiana gives you a homestead exemption in the amount of $19,300 for your home or principal residence. This can be doubled for married filers. Any interest in real estate held as a tenant by the entirety also is exempt, unless both owners are bankrupt.

What type of debt Cannot be discharged? ›

Debts Never Discharged in Bankruptcy

Alimony and child support. Certain unpaid taxes, such as tax liens. However, some federal, state, and local taxes may be eligible for discharge if they date back several years. Debts for willful and malicious injury to another person or property.

What can a creditor do if I can't pay? ›

Action your creditor can take
  1. Bailiffs. ...
  2. If you're being taken to court for debt. ...
  3. Changing a court order for debt. ...
  4. How a creditor can get information about your finances. ...
  5. Creditor takes money from your bank account. ...
  6. If a creditor takes money from your wages. ...
  7. Charging orders. ...
  8. Harassment by creditors.

Which creditors have no security? ›

An unsecured creditor is an individual or institution that lends money without obtaining specified assets as collateral. This poses a higher risk to the creditor because it will have nothing to fall back on should the borrower default on the loan.

Which creditors have priority but no security? ›

Unsecured Creditors. An unsecured creditor is essentially an individual or institution that lends money without obtaining specified assets as collateral. Unsecured creditors are generally placed into two categories: priority unsecured creditors and general unsecured creditors.

What creditors can freeze your bank account? ›

A creditor or debt collector cannot freeze your bank account unless it has a judgment. Judgment creditors freeze people's bank accounts as a way of pressuring people to make payments.


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