Montana Bankruptcy Exemptions

Filing bankruptcy in Montana does not mean you have to give up everything you own. Both Chapter 7 and Chapter 13 use a system of exemptions, laws that protect certain property so you can get a fresh start.

At the Law Office of Jeffrey K. Greenwell, PLLC, we help individuals and families across Montana understand exactly what property they can keep and how exemptions apply in their case.

What Are Bankruptcy Exemptions?

Bankruptcy exemptions are laws that protect certain types of property from being taken by creditors or the bankruptcy trustee.

• In Chapter 7, exempt property is protected, and you keep it.
• In Chapter 13, exemptions help determine how much you must pay unsecured creditors, but you usually keep all your property.

If you have lived in Montana for the 2 years preceding your filing date, you will use the Montana exemption statutes. The amounts change over time, so it’s important to use the most up-to-date figures when you file.

Common Montana Bankruptcy Exemptions

Below is an overview of a few types of property protected in a Montana bankruptcy. Your specific situation determines how these and all other exemptions apply.

1. Homestead (Your Home)

Montana has a generous homestead exemption that protects equity in your primary residence, which includes mobile/manufactured homes, and campers/trailers.

Key points:

• Must be your primary residence
• Must meet Montana’s homestead declaration requirements
• Equity protected is capped by statute, which is periodically updated

2. Motor Vehicle Exemption

Montana allows you to protect equity in at least one vehicle up to a set dollar amount.

Even if your car is worth more than the protection provided by the exemption, you may still be able to keep it through negotiation or by filing for Chapter 13.

3. Household Goods & Personal Property

Most everyday items are exempt, including:

• Furniture and household goods
• Appliances and electronics
• Clothing and personal effects

Most people do not lose everyday household belongings in bankruptcy.

4. Tools of the Trade

If you rely on specific tools or equipment to make a living, such as mechanic’s tools, construction equipment, hair stylist’s equipment, or professional instruments, Montana law protects them up to a certain dollar amount.

5. Wages & Income

A portion of your wages is protected under Montana and federal law. Only a specific percentage of “disposable earnings” may be available to creditors.

6. Retirement Accounts & Benefits

Many retirement accounts and benefits receive strong protection, including:

• Most tax-qualified retirement plans (401(k), pensions, IRAs)
• Social Security benefits
• Veterans, disability, and certain public assistance benefits

Important: Never cash out a retirement account before talking to an attorney; you will lose protection.

How Exemptions Work in Chapter 7 vs. Chapter 13

The trustee reviews your property to determine if any items have non-exempt equity. If exemptions cover everything, your case may be a no-asset case, meaning nothing will be sold.

Chapter 7 Bankruptcy

If you do have non-exempt equity, options may include:

• Buying back the non-exempt portion
• Converting to Chapter 13
• Surrendering property that you do not need

Chapter 13 Bankruptcy

In Chapter 13, you generally keep everything you own. However, exemptions help determine the minimum amount unsecured creditors must receive through your payment plan.

The more property protected as exempt, the lower your plan’s required payout may be.

Why Work with a Montana Bankruptcy Attorney on Exemptions?

Exemptions are not just a list; they are a strategy.

Working with the Law Office of Jeffrey K. Greenwell, PLLC means you’ll get:

• A full review of all your assets
• Proper application of current Montana exemption laws
• Strategies to protect your home, vehicles, and tools
• Guidance on whether Chapter 7 or Chapter 13 better preserves your property
• Step-by-step support through the entire process

Frequently Asked Questions

Will I lose my house?

Not necessarily. Most filers retain their home under Montana’s homestead exemption, provided they continue making the mortgage payments. We calculate your equity and review your mortgage status to give you a clear answer. 

Can I keep my car?

In most cases, yes, provided you keep making the monthly payments.

Do I have to list everything I own?

Yes. Full disclosure is required, and we help you apply exemptions properly to protect as much as the law allows.

Talk With a Montana Bankruptcy Lawyer About Your Exemptions

If you’re worried about what you might lose, get clear answers before you file.

Contact the Law Office of Jeffrey K. Greenwell, PLLC to schedule a confidential consultation. We’ll explain which Montana exemptions apply to your situation and help you protect the property that matters most.

Call us at (406) 730-3015 or use our online form to get started.