If you’re considering bankruptcy in Florida, you’re probably asking:
“Will I lose my house? My car? Everything I own?”
The good news is that Florida has some of the strongest asset protection laws in the country — especially for homeowners.
Understanding Florida’s bankruptcy exemptions is critical before filing. Here’s what you need to know.
Florida Requires Use of State Exemptions
If you have lived in Florida for at least 730 days (2 years) before filing bankruptcy, you must use Florida’s state exemptions. Florida does not allow most filers to choose the federal exemption system.
Fortunately, Florida’s exemptions — particularly for homesteads — are among the most powerful in the United States.
Florida’s Unlimited Homestead Exemption
Florida is well known for its unlimited homestead exemption — subject to acreage limits.
🏠 Homestead Protection
Florida protects 100% of the equity in your primary residence, regardless of value, provided:
- The property is your permanent residence
- It sits on no more than:
- ½ acre within a municipality, or
- 160 acres outside a municipality
There is no dollar cap on equity.
Example:
- Home value: $1,200,000
- Mortgage balance: $600,000
- Equity: $600,000
That $600,000 equity is fully protected, assuming the property qualifies.
⚠️ Important: A federal 1,215-day residency rule may cap homestead protection in certain recent purchases. Proper planning is critical.
Florida Personal Property Exemption
Florida provides:
- $1,000 in personal property exemption
This covers items such as:
- Furniture
- Electronics
- Clothing
- Bank accounts
If you do not claim the homestead exemption, you may receive an additional $4,000 “wildcard” exemption that can be applied to any property.
This wildcard is often used by renters to protect cash or bank balances.
Motor Vehicle Exemption
Florida protects:
- Up to $1,000 in vehicle equity
If married and filing jointly, exemptions may be doubled if both spouses have an ownership interest.
Because the vehicle exemption is modest, planning is important if you have significant car equity.
Retirement Accounts Are Strongly Protected
Florida provides very strong protection for retirement accounts, including:
- 401(k)s
- IRAs
- Pensions
- Annuities
In fact, Florida’s annuity protections are broader than many other states.
Retirement funds are typically safe in Florida bankruptcy cases.
Wages and Public Benefits
Florida offers protections for:
- Head-of-household wages (strong wage garnishment protections)
- Social Security
- Disability benefits
- Unemployment compensation
- Workers’ compensation
Florida’s wage protections can be especially important before and during bankruptcy.
How Exemptions Work in Chapter 7
In Chapter 7:
- A trustee can sell non-exempt property.
- Exempt property is protected.
- Many Florida cases are “no-asset” cases, particularly for homeowners using the homestead exemption.
However, renters with significant cash or non-exempt assets need careful planning.
How Exemptions Work in Chapter 13
In Chapter 13:
- You keep your property.
- You enter a 3–5 year repayment plan.
- The value of non-exempt property affects how much you must repay unsecured creditors.
Even in Florida, exemption strategy affects the affordability of your plan.
Important Rules to Know
1. Residency Requirements
To use Florida exemptions:
- You must have lived in Florida for at least 730 days before filing.
- A separate federal 1,215-day rule may limit homestead protection for recently acquired homes.
These timing rules are extremely important.
2. Exemptions Protect Equity — Not Full Value
Exemptions protect equity.
Example:
- Vehicle value: $20,000
- Loan balance: $17,500
- Equity: $2,500
Only the $2,500 equity matters.
3. Do Not Transfer Property Before Filing
Transferring assets before bankruptcy can result in denial of discharge or other serious consequences.
Why Florida Is Unique
Florida is considered one of the most debtor-friendly states because of:
- Unlimited homestead protection (with acreage limits)
- Strong retirement protections
- Strong wage protections
However, limited personal property exemptions make strategic planning essential.
Is Bankruptcy Right for You?
Bankruptcy can:
- Stop foreclosure
- Stop wage garnishment
- Stop repossession
- Eliminate credit card debt
- Eliminate medical debt
- Provide a financial reset
But filing without a proper exemption strategy can create unnecessary risk.
Speak With an Experienced Bankruptcy Attorney
The right strategy depends on:
- Whether you own a home
- When you purchased your home
- Your vehicle equity
- Your bank account balances
- Your retirement accounts
- Your long-term financial goals
Before filing bankruptcy in Florida, make sure you understand exactly what property is protected.
If you’re overwhelmed by debt, schedule a consultation to review your options and protect what matters most.
