Bankruptcy Exemptions in Nevada (N.R.S. 21.090)

Many people think that filing for bankruptcy in Nevada means selling every last possession to satisfy debts. That isn’t the case at all. The process allows a person to address debt in a meaningful way. In fact, there are a number of exemptions that will enable a person to keep assets that are important to their survival and are personally significant. It’s important to understand these exemptions to make the most of your bankruptcy case. Our Las Vegas bankruptcy lawyers explain.

Does Nevada Allow Bankruptcy Exemptions?

Yes, Nevada allows bankruptcy exemptions. When a person files for bankruptcy, they do not have to surrender property that falls into a protected category. The exemptions are essential for basic needs like housing, a motor vehicle, certain amounts of income and disability assistance devices.

In addition, exemptions allow individuals to keep property that is especially meaningful or significant on a personal level. It is up to the bankruptcy filer to identify and claim bankruptcy exemptions for which they qualify.

What Property Exemptions Are Allowed Under the Nevada Bankruptcy Code?

Property exemptions that are allowed under the Nevada bankruptcy code include:

House or homestead – Up to $605,000 in equity; this amount may be adjusted over time. For the homestead bankruptcy exemption to apply, the person must have a declaration on file with the county recorder’s office at the time they file their case.
Health aides, such as disability mobility assistance devices
Funeral service and burial plot funds when they are prepaid or set aside in a trust
Photographs and personal keepsakes
Criminal restitution when the filer is the victim of a crime and restitution is ordered
Payments and refunds from the United States Earned Income Tax Credit
Mortgage impound accounts (escrow)
Art, books, jewelry and musical instruments up to $5,000
Equity in furniture, household appliances, household goods, electronics, clothing, yard equipment, other home devices and products up to $12,000
Vehicles – The amount of equity in a vehicle up to $15,000. The amount is unlimited if the car is custom-fitted for use by a disabled person
Payments of a personal injury award up to a certain amount
Public benefits – Disability, workers’ compensation, unemployment, children’s aid, Social Security benefits
Public employee retirement benefits
Income – Weekly earnings of up to 75% of wages or 50 times the federal minimum wage, whichever is greater
Tools of the trade – Up to $4,500 in farm tools, equipment seed or mining equipment; uniforms, arms and accessories that are necessary or required
Library items, tools, equipment, supplies and inventory of up to $10,000
A wildcard exemption of up to $10,000 for items that do not fall into any other category

In addition to these exemptions, several other categories may apply in unique circumstances. These exemptions may impact real property, personal property, financial accounts, securities or defined benefit payments. Therefore, it’s crucial to thoroughly understand the individual circumstances to identify what applies and what needs to happen to claim each exemption.

What Is the Nevada Bankruptcy Homestead Exemption?

The Nevada bankruptcy homestead exemption is up to $605,000 in equity in a home. The amount is the equity, not necessarily the home’s total value. For example, if a person owns a home that is worth $750,000, they may have a mortgage of $500,000. In that case, the total equity amount is $250,000. The equity amount is under the $605,000 allowable homestead bankruptcy exemption. In this case, the Nevada bankruptcy homestead exemption protects the entire equity in the home.

Where Can I Find a List of Nevada’s Bankruptcy Exemptions?

Nevada’s bankruptcy exemptions are listed in Nevada Revised Statutes 21.090¹.

Rather than using federal bankruptcy exemptions, the State of Nevada has created its own list of exemptions. The amounts may change periodically. In addition, not every exemption applies to every situation. A person has to meet the circumstances or conditions in order to use many of the exemptions.

Nevada Bankruptcy Wildcard Exemption

The Nevada bankruptcy wildcard exemption allows a bankruptcy filer to withhold and protect a certain amount of property that does not fall under any other kind of exemption. For example, a person may claim up to $10,000 of the property of their choice that is not otherwise exempt. For the individual filer, it’s an exemption above and beyond any of the other types of protections that may apply in the law. The wildcard exemption helps a bankruptcy filer with unique, individual circumstances and ensures that a person can keep the property that matters to them the most.

How Do Nevada Bankruptcy Exemptions Apply to Spouses?

When spouses apply for bankruptcy together, Nevada law allows them each to claim the entire exemption in a category. For example, they may own an art collection that is worth $8,000. Ordinarily, the exemption for art, books, jewelry and musical instruments is $5,000. For single filers, they would be over the exempt amount. However, because both spouses are filing, they may double the total exemption amount up to $10,000. In this case, the entire art collection is exempt because each spouse may claim the full amount to double the total allowable amount.