The U.S. Bankruptcy Code and Wisconsin law allow individuals to claim bankruptcy exemptions from trustee liquidation in a Chapter 7 bankruptcy. Debtors in Wisconsin can choose either state or federal exclusions from creditor claims.

Wisconsin provides several exemptions. First, the homestead exemption excludes a debtor’s personal residence up to $40,000. Automobiles are also excluded, up to $1,200 in total value, in addition to any unused part of the household goods exemption.

The household goods exemption governs personal items, such as goods, furnishings, clothes, keepsakes, jewelry, appliances, musical instruments, guns, sporting equipment, pets or other personal property that cannot exceed $1,500. This exemption also governs items, such as art objects and furs. Cemetery lots, burial facilities that are aboveground, monuments, tombstones and coffins are also exempt from liquidation.

Wisconsin also excludes items used for the debtor’s business or tools of their trade. These include business equipment, inventory and farm products, along with professional books. These items cannot exceed a total value of $7,500.

Up to specified amounts, federal exemptions include vehicles, reasonably-necessary apparel, household goods, household appliances, jewelry, pensions, home equity, tools used in the debtor’s occupation, unpaid and earned wages and personal injury settlements or awards. This law also exempts public benefits, such as welfare, Social Security and unemployment compensation.

Federal law does not exclude some property. Non-exempt items include expensive musical instruments, where the debtor is not a profession musician, family heirlooms, a second motor vehicle, a second residence or a vacation home and collections of valuable items, such as stamps and coins. Cash, bank accounts, bonds and investments are not exempt.

An attorney can assist debtors contemplating bankruptcy with determining their options. A lawyer may help debtors properly evaluate their debt and develop a viable exemption plan.

Source:, “Exempt vs. non-exempt property under Chapter 7,” accessed on Feb. 12, 2017