This article applies to Oklahoma bankruptcy in a very general sense. This article is no substitute for discussing your situation with a Oklahoma bankruptcy attorney. Every situation is unique and many of the general rules have exceptions.
Individual Debtors Filing for Oklahoma Bankruptcy May Only Use Exemptions Provided by Oklahoma State Law
Individuals filing for bankruptcy can generally use the bankruptcy exemptions they may be entitled to under the laws of the state of their domicile, and under federal laws other than bankruptcy. 11 U.S.C. section 522(b)(2). In a few states, individual debtors can also use exemptions set out in section 522(d), but this is only allowed in states that have not enacted "opt out" legislation under section 522(b)(1). Section 522(b)(1) allows states to preclude an individual debtor in that state from using section 522(d). The majority of states have done this.
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Oklahoma is one of the majority of states having enacted "opt out" legislation. Because of this, individual debtors filing for bankruptcy in Oklahoma are only allowed to use the exemptions found in Oklahoma state law and federal laws other than the Bankruptcy Code. Okla. Stat. tit. 31, section 1(B).
Oklahoma Bankruptcy Exemptions
The following list is a very general overview of the Oklahoma bankruptcy exemptions which most often affect individual debtors. This list is not meant to be exhaustive and is no substitute for a consultation with a Oklahoma bankruptcy attorney. All citations are to the Oklahoma Statutes, the formation Title(number)-Section(number).
Homestead Exemption
An individual may exempt a home, but only if the home is his or her personal residence. T31 - 1(A)(1). This includes manufactured homes. 31 - (1)(A)(2). When the homestead is located outside of any city or town, it is limited to a size of 160 acres. 31 - 2(A). When the homestead is located within a city or town, the homestead may not exceed one (1) acre of land. 31 - 2(C). If more than twenty-five percent (25%) of the total square foot area of the home and improvements is used for a business, the homestead exemption amount is capped at five thousand dollars ($5,000). Id. However, the homestead exemption will not apply when the debt is due for the purchase money of the homestead, or a portion of the purchase money; for taxes or a tax lien on the homestead; and for debts on work and material used in improvements to the property. 31 - 5(1), (2), and (3).
Furniture
An individual may exempt "all household and kitchen furniture" provided it is held primarily for personal, family, educational, or household use by the individual debtor or his or her dependents. 31 - 1(A)(3). This includes a personal computer and related equipment. Id.
Tools of the Trade and Professional Equipment
An individual may exempt any tools, apparatus, or books used to conduct a trade or profession by either the individual debtor or the debtor's dependent, but only up to an aggregate value of $10,000. 31 - (1)(A)(5).
Pictures and Books
An individual may exempt all "books, portraits, and pictures" which the debtor holds primarily for his or her personal use, for use by the debtor's family, or use by the debtor's dependent. 31 - (1)(A)(6).
Clothing
An individual may exempt clothing for either the debtor's personal use, family use, or use by the debtor's dependent; but only up to an aggregate value of $4,000. 31 - 1(A)(7).
Wedding and Anniversary Rings
An individual may exempt wedding and anniversary rings, but only up to $3,000 in value total. 31 - 1(A)(8).
Professionally Prescribed Health Aids
An individual may exempt all professionally prescribed health aids, whether for the debtor or the debtor's dependent. 31 - 1(A)(9). There is no value cap on this exemption, but the health aid must be proscribed by a health professional to qualify.
Motor Vehicle
An individual may exempt his or her interest in one motor vehicle, up to $7,500 in value. 31 - 1(A)(13).
Firearms
An individual may exempt up to $2,000 worth of firearms, provided the firearms are held primarily for personal, family or household use. 31 - 1(A)(14). This means firearms held as collectibles, or for trade or sale, are not eligible for exemption.
Wages and Income
An individual may exempt seventy-five percent (75%) of all current wages or earnings he or she receives for personal or professional services which have been earned for the ninety (90) day period preceding the bankruptcy filing (but not in proceedings to garnish wages for child support owing). 31 - 1(A)(18); and 12 - 1171.1(B).
Alimony, Support, Maintenance, and Child Support
An individual may exempt his or her right to receive alimony, spousal support, separate maintenance, or child support payments, but only to the extent reasonably necessary to support the individual debtor or the debtor's dependent. 31 - 1(A)(19).
ERISA Qualified Benefits
An individual may exempt any interest in a retirement plan or arrangement which is deemed an ERISA (Employment Retirement Income Security Act) qualified plan by federal law. 31 - 1(A)(20).
VA Disability Benefits
An individual may exempt his or her Veteran's Affairs disability benefits. 31 - 7. There is no value cap.
Assessment or Mutual Benefits
An individual may exempt all monies or benefits received by Mutual Benefit Associations operating under Article 24 of Tit. 36 of the Oklahoma Statutes. 36 - 2410.
Fraternal Benefit Society Benefits
An individual may exempt all monies, benefits, charities, and relief or aid to be paid or rendered by a fraternal benefit society. 36 - 2718.1.
Prepaid Funeral Benefits Placed in Trust
An individual may exempt funeral benefits which were prepaid and placed in trust. 36 - 6125.
Group Life Insurance Policy and Proceeds
An individual may exempt a group life insurance policy, or the proceeds from a group life insurance policy. 36 - 3632(A).
County Employee's Retirement Benefits
An individual may exempt money due or to become due under a pension plan for county employees. 19 - 959.
Firefighter, Police, and Law Enforcement Pension and Retirement Benefits
An individual may exempt money due or to be paid under a firefighter pension plan. 11- 49-126(A). An individual debtor may also exempt money due or to be paid under a police pension plan. 11 - 50-124(A). This also applies to law enforcement pension plans in Oklahoma. 47 - 2-303.3(A).
Teachers' Retirement Benefits
An individual may exempt money due or to be paid under the teachers' retirement system. 70 - 17-109(A).
Oklahoma Public Employees Retirement Benefits
An individual may exempt money due or to be paid under the Oklahoma Public Employees Retirement System. 74 - 923(A).
Social Security Benefits
An individual may exempt social security benefits. 56 - 173.
Oklahoma Unemployment Benefits
An individual may exempt money due or to be paid as unemployment benefits under the Oklahoma Employment Security Act of 1980. 40 - 2-303.
This is a partial list of the bankruptcy exemptions provided by Oklahoma. While this article attempts to provide a general overview of Oklahoma bankruptcy exemptions, this article is not intended to substitute for legal advice from a competent Oklahoma bankruptcy attorney. There are often exceptions to these general rules. Before making the final decision whether bankruptcy is the right choice, an individual debtor should consult with an Oklahoma bankruptcy attorney.
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