Texas Bankruptcy Exemptions: What You Get to Keep

Texas is famous for one of the most generous exemption systems in the country. Its homestead exemption has no dollar limit on value—it is capped instead by acreage: up to 10 acres for an urban home, and up to 100 acres for a single adult or 200 acres for a family in a rural area (Texas Property Code Chapter 41). On top of that, Texas protects up to $50,000 in personal property for a single adult and $100,000 for a family (Texas Property Code Chapter 42). And unlike many states, Texas lets you choose between the Texas exemptions and the federal bankruptcy exemptions—you pick whichever set protects more of your property, but you cannot mix items from both lists.

The Texas homestead exemption

The homestead is the heart of Texas debtor protection. Under the Texas Constitution and Property Code Chapter 41, the equity in your primary residence is protected without regard to how much it is worth. A debtor with a fully paid-off, high-value home can keep it through Chapter 7 bankruptcy, provided the property stays within the acreage limits.

• Urban homestead: one or more contiguous lots totaling not more than 10 acres, together with the improvements on it.
• Rural homestead (single adult): up to 100 acres, which may be in one or more parcels.
• Rural homestead (family): up to 200 acres.

If you sell your homestead, the sale proceeds stay exempt for six months so you can reinvest them in a new homestead. After six months, that protection lapses if the funds have not been used to buy a replacement home.

The federal cap that overrides Texas's unlimited homestead

Even though Texas law places no dollar ceiling on the homestead, federal bankruptcy law does in certain situations. Under 11 U.S.C. § 522(p), if you acquired your homestead within 1,215 days (about 3 years and 4 months) before filing, the amount you can shield is capped at a federal figure that Congress adjusts for inflation every three years—roughly in the low-$200,000s as of 2025. Because this number changes, confirm the current cap before relying on it. A separate provision, 11 U.S.C. § 522(o), can also reduce the homestead if you converted nonexempt assets into home equity to defraud creditors in the ten years before filing. These caps do not apply if you simply rolled equity from a prior Texas homestead into your current one.

Vehicles, personal property, and the $50,000/$100,000 cap

Texas does not give vehicles a separate dollar exemption. Instead, motor vehicles fall inside the broad personal-property cap of $50,000 (single adult) or $100,000 (family) found in Property Code § 42.001. Within that aggregate limit, Texas § 42.002 lists specific categories that count, including:

• One motor vehicle for each member of the household who holds a driver's license (or who relies on another person to operate the vehicle for them);
• Home furnishings, including family heirlooms;
• Clothing and food provisions;
• Tools, equipment, books, and apparatus (including boats and vehicles) used in a trade or profession;
• Jewelry, limited to not more than 25% of the aggregate exemption (so up to $12,500 single / $25,000 family);
• Two firearms and athletic/sporting equipment;
• Certain livestock and household pets—for example, two horses, mules, or donkeys with their tack, 12 head of cattle, 60 head of other livestock, and 120 fowl;
• The cash value of life insurance and certain annuities.

Note that valuation is based on equity. If you owe money on a financed car, only the equity (value minus the loan balance) counts against the cap, and you generally must stay current on the loan to keep the vehicle.

Is there a Texas "wildcard"?

Texas has no true wildcard exemption like the federal system's catch-all. Instead, the generous personal-property cap functions as a wide umbrella over the listed categories. If you hold property that does not fit any Texas category—such as a large amount of cash, stocks, or a tax refund—the federal exemptions may serve you better, because federal law offers a wildcard you can apply to any asset. This is exactly why Texas's right to choose between systems matters.

Wages and retirement accounts

Current wages for personal services are exempt under Texas law, and most retirement accounts—401(k)s, pensions, IRAs, and similar tax-qualified plans—are protected under Property Code § 42.0021 and federal bankruptcy law. On garnishment generally, Texas is far more protective than the federal baseline: the federal Consumer Credit Protection Act caps wage garnishment at 25% of disposable earnings, but Texas does not allow garnishment of wages for most consumer debts at all. Court-ordered child support, spousal support, taxes, and federally guaranteed student loans are the main exceptions.

Choosing federal exemptions instead

Because Texas is an "opt-out optional" state, you may elect the federal exemption scheme under 11 U.S.C. § 522(b). The federal homestead exemption is much smaller than Texas's (a fixed dollar amount adjusted for inflation), but federal law includes a wildcard and other categories that can protect property Texas does not. Married couples filing jointly must both use the same set—they cannot have one spouse take state exemptions and the other take federal. This decision is highly fact-specific, and getting it wrong can cost you property, so many filers consult a bankruptcy attorney before choosing.

How to claim and where to verify

Exemptions are claimed on Schedule C of your bankruptcy petition, where you list each asset, the law that protects it, and its value. A trustee or creditor may object if an exemption is claimed improperly, so accuracy matters. Before relying on any figure here, verify the current statutes—Property Code Chapters 41 and 42 are the controlling Texas law, and the dollar caps in federal provisions like § 522(p) change over time.

For consumer questions and to confirm your rights, contact the Office of the Attorney General of Texas, Consumer Protection Division, which publishes consumer guidance and accepts complaints. For the federal side, the U.S. Courts and the Department of Justice U.S. Trustee Program publish the periodically adjusted federal exemption amounts. When real property and large assets are at stake, confirm the figures with these official sources or a licensed Texas bankruptcy attorney rather than relying on summaries alone.

Official Texas Sources

This page is based on Texas law. Limits and deadlines change — verify the current details directly with the official Texas sources below. This is general legal information, not legal advice.

• Texas Attorney General - Consumer Protection — official Texas agency.
• File a Consumer Complaint - Texas Attorney General
• Texas Finance Code Chapter 392 - Debt Collection

Federal law also applies. Federal laws like the Fair Debt Collection Practices Act and Fair Credit Reporting Act protect you nationwide, on top of Texas’s own rules.