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Understanding North Carolina bankruptcy exemptions

The bankruptcy process can be complex, yet beneficial, to those who choose to embark upon the journey. While it is quite possible that parties will have to forfeit certain assets during the process, it is possible to maintain other assets.

Filers can achieve this by utilizing certain bankruptcy exemptions that they qualify for. In North Carolina, there are a few important things to understand about this option.

State exemptions

While some states allow bankruptcy filers to choose between state or federal options, others make the decision for them. In North Carolina, bankruptcy filers must utilize the state's exemptions, with the option to implement certain federal exemptions along with state offerings. However, it is important to note that not all exemptions apply to every situation.

Common exemptions

Thankfully, the state offers several different exemption options. Some of the most common ones include:

  • Homestead or burial plot
  • Wages
  • Retirement and pension
  • Public benefits
  • Personal property
  • Motor vehicle

Several other exemptions apply in certain situations. For example, alimony and child support may be exempt from certain divorced parties. Married parties have an advantage, as each person can make separate exemptions. This practice is often referred to as "doubling."


For those who invoke the homestead or burial plot exemption but do not utilize the entire exemption amount on a property, the remaining amount may be used as a wildcard. In other words, filers may apply the remaining exemption to another property that they choose. The main stipulation is that the filer must have purchased the property more than 90 days before filing for bankruptcy.

Those who choose to utilize bankruptcy exemptions should take time to fully understand their capabilities. It may be beneficial to consult with knowledgeable professionals, as well as familiarize themselves with the law in full.

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