If you file bankruptcy in Arizona, state law decides what you keep. The Arizona bankruptcy exemptions protect up to $400,000 of equity in your home, $15,000 of equity in one vehicle, qualified retirement accounts with no state dollar limit, most of your wages, court-ordered support, and specified household goods and personal items up to set caps. Anything above those caps is reachable by a Chapter 7 trustee.
Who Can Use Arizona’s Exemptions
Arizona has opted out of the federal exemption list in 11 U.S.C. § 522(d), so filers here use the state’s figures rather than the federal alternatives.1Arizona Legislature. Arizona Code 33-1133 – Other Exemption Laws
You also need to have been domiciled in Arizona for the 730 consecutive days (about two years) before filing. If you moved more recently, the court looks at where you lived for most of the 180 days before that two-year window and applies that earlier state’s exemptions.2Office of the Law Revision Counsel. 11 U.S. Code 522 – Exemptions Recent transplants should check this timeline before filing.
Home Equity
The homestead exemption shields up to $400,000 of equity in your primary residence. It covers a house, condominium, cooperative, mobile home, or a houseboat or travel trailer you actually live in. The $400,000 is equity, meaning value after mortgages and liens. Only one homestead exemption applies per person or married couple.3Arizona Legislature. Arizona Code 33-1101 – Homestead Exemptions
Sell the home and the exemption follows the identifiable cash proceeds for eighteen months or until you buy a new homestead, whichever comes first.3Arizona Legislature. Arizona Code 33-1101 – Homestead Exemptions
Federal Cap If You Bought Recently
Federal law overrides the state figure when the home is new to you. Under 11 U.S.C. § 522(p), if you acquired your residence within 1,215 days (roughly three years and four months) before filing, the exemption on that equity is capped at $214,000 for cases filed on or after April 1, 2025.2Office of the Law Revision Counsel. 11 U.S. Code 522 – Exemptions If you bought your house within the last few years, this is the number that actually controls.
Vehicle
You can protect up to $15,000 of equity in one motor vehicle. If you or a dependent has a physical disability, the limit is $25,000.4Arizona Legislature. Arizona Code 33-1125 – Personal Items This covers equity, so a $30,000 car with a $20,000 loan has $10,000 of equity and fits well under the cap. These figures adjust annually for inflation beginning January 1, 2024, rounded to the nearest $100, so confirm the current statutory amount before you file.
Household Goods and Personal Items
Household furniture, furnishings, appliances, and consumer electronics you personally use are exempt up to a combined fair market value of $15,000.5Arizona Legislature. Arizona Code 33-1123 – Household Furniture, Furnishings and Appliances Used goods tend to have low resale value, so most filers keep everything in this category. The cap adjusts annually for cost of living.
A separate statute sets individual caps on specific items:4Arizona Legislature. Arizona Code 33-1125 – Personal Items
- Clothing, up to $500
- Engagement and wedding rings, up to $2,000 combined
- One watch, up to $250
- Books and personal documents, up to $250
- Musical instruments for family use, up to $400
- Firearms, up to $2,000
- Computer, bicycle, sewing machine, or family bible, up to $2,000 combined
- Professionally prescribed prostheses and mobility devices, fully exempt
Arizona has no wildcard exemption, which means unused dollars in one category can’t be shifted to cover property in another. Every asset must fit within its own cap.
Retirement Accounts and Life Insurance
Money in qualified retirement plans is fully exempt under state law with no dollar cap. That covers 401(a), 403(a), 403(b), traditional IRA, Roth IRA, and 457 deferred compensation plans.6Arizona Legislature. Arizona Code 33-1126 – Money Benefits or Proceeds
Two exceptions matter. Contributions made within 120 days before filing are not protected, and trustees watch for last-minute transfers. An alternate payee under a qualified domestic relations order (for example, an ex-spouse awarded a share in a divorce) has an independent exemption for that share.6Arizona Legislature. Arizona Code 33-1126 – Money Benefits or Proceeds
Federal law adds a cap that applies only to traditional and Roth IRAs, not employer-sponsored plans like 401(k)s. Under 11 U.S.C. § 522(n), IRA assets are protected up to $1,711,975 in cases filed on or after April 1, 2025.7Federal Register. Adjustment of Certain Dollar Amounts Applicable to Bankruptcy Cases This matters only if your IRA balance is large.
Life insurance proceeds payable to a surviving spouse or child are exempt up to $20,000. The cash surrender value of a policy you’ve held continuously for at least two years is also exempt if the beneficiary is a spouse, child, parent, sibling, or dependent family member. That protection disappears if you’ve pledged the cash value as collateral. Health, accident, and disability benefits are protected under the same section.6Arizona Legislature. Arizona Code 33-1126 – Money Benefits or Proceeds
Wages and Support Payments
Arizona’s wage protection is tighter than the federal default. Garnishment is limited to the lesser of 10 percent of your weekly disposable earnings or the amount by which those earnings exceed 60 times the highest applicable minimum wage (federal, state, or local).8Arizona Legislature. Arizona Code 33-1131 – Definition; Wages; Salary; Compensation Lower earners keep nearly all their pay; the 10 percent cap bites more as income rises.
Court-ordered child support and spousal maintenance you receive are fully exempt with no dollar limit. One exception: the exemption does not protect property from a judgment for child support arrearages, so a creditor holding that kind of judgment can still reach otherwise shielded assets.6Arizona Legislature. Arizona Code 33-1126 – Money Benefits or Proceeds
Tools of Trade
Up to $5,000 in tools, equipment, instruments, and professional books that you actually use in your trade or business is exempt. The statute also reaches intangible work product like client lists, domain names, and business websites. It specifically does not cover a motor vehicle used mainly for personal transportation, even if you drive it to work; that falls under the vehicle exemption.9Arizona Legislature. Arizona Code 33-1130 – Tools and Equipment Used in a Commercial Activity, Trade, Business or Profession Filers whose primary income comes from farming get a separate $2,500 exemption for farming equipment and implements.
Food and Provisions
All food, fuel, and provisions set aside for individual or family use for six months are exempt. No dollar cap applies.
What Happens to Anything That Doesn’t Fit
In Chapter 7, the trustee identifies assets that exceed your exemptions, sells them, and distributes the proceeds to creditors.10United States Courts. Chapter 7 – Bankruptcy Basics Most consumer Chapter 7 cases are no-asset cases because everything fits inside the caps. A second vehicle, equity in a vacation property, or significant non-retirement investments are the usual sources of exposure.
Chapter 13 works differently. You keep all your property, but unsecured creditors must receive at least what they would have gotten in a Chapter 7 liquidation. Exemptions set the floor: the more non-exempt property you have, the higher your required payments over the three-to-five-year plan.
Timing can also matter if you’re near a cap. The state’s vehicle and household goods figures adjust annually with inflation, and the federal homestead and IRA caps reset every three years. A few weeks either side of a filing date has, in some cases, decided whether an asset stays or goes.