Connecticut Bankruptcy Exemptions and Law

For the most part, federal law governs bankruptcy proceedings. The bankruptcy courts must abide by the U.S. Bankruptcy Code. However, there are also state laws that control some aspects of your bankruptcy case.

Connecticut, like every other state, abides by the federal bankruptcy laws. At the same time, Connecticut state law offers debtors who file bankruptcy additional protections through something called “bankruptcy exemptions.”

These exemptions help bankruptcy filers protect their assets, such as their home, motor vehicle, and personal property. The question many debtors have is: how much protection do Connecticut bankruptcy exemptions provide?

Here, we will explain how the bankruptcy laws work in the State of Connecticut, including the different types of bankruptcy. We will also discuss the state bankruptcy exemptions and compare them to the federal exemptions. Finally, we will address the question of whether you can choose to claim the federal exemptions instead of the exemptions provided under state law.

If you’re looking for a fresh start and think bankruptcy may be the answer, contact a local Connecticut bankruptcy attorney. They’ll help you file your bankruptcy petition and ensure that you get all the protection possible during your Chapter 7 or Chapter 13 bankruptcy case.

Types of Personal Bankruptcy

There are two types of personal bankruptcy: Chapter 7 bankruptcy and Chapter 13 bankruptcy. In a Chapter 7 bankruptcy case, the bankruptcy court discharges some or all of the individual’s debts. As long as the person qualifies for bankruptcy and includes their secured and unsecured debts in their bankruptcy petition, they should walk away debt-free.

In a Chapter 13 bankruptcy, the debtor isn’t looking to eliminate their debt. Instead, they are looking to restructure their debt, so their monthly payments are more manageable. A Chapter 13 also allows the individual to catch up on any delinquent accounts so they can avoid further debt collection activity.

There are several differences between a Chapter 7 and Chapter 13 bankruptcy. Some of these include:

• A Chapter 7 bankruptcy takes about four to six months to complete. A Chapter 13 bankruptcy takes anywhere from three to five years.
• The goal of a Chapter 13 bankruptcy is to keep your assets, especially your house and motor vehicle. In a Chapter 7 case, the debtor often has no property or is willing to voluntarily surrender their property so the bankruptcy trustee can sell it and use the proceeds to pay their creditors. This is why many people refer to Chapter 7 as a liquidation bankruptcy.
• Your income must be below your state’s median household income to qualify for Chapter 7, whereas in a Chapter 13 case, you must prove that you have sufficient regular income to afford a reasonable repayment plan.
• Once your Chapter 7 case is over, you no longer owe your debts (for the most part) and can start anew. In a Chapter 13, you make payments to your creditors for three to five years. Once you complete your Chapter 13 repayment plan, remaining balances in dischargeable unsecured debts are discharged.
• You can file Chapter 7 bankruptcy regardless of how much you owe your creditors. There is a limit to how much you can owe to qualify for a Chapter 13.

Of course, these aren’t the only differences between the two types of bankruptcy. When deciding which route is best for you and your financial situation, you should sit down with an experienced Connecticut bankruptcy lawyer.

Who Qualifies for Bankruptcy in Connecticut?

Just because you are in debt does not mean that you automatically qualify to file for bankruptcy. Under federal law and, by extension, Connecticut law, you must meet certain criteria to file a Chapter 7 or Chapter 13 bankruptcy.

Under Connecticut bankruptcy law, a debtor must meet certain basic requirements to file for bankruptcy. These include:

• You must have lived in Connecticut for at least 730 days (two years) before claiming Connecticut’s bankruptcy exemptions.
• You must be domiciled within the county for the majority of the preceding 180-day period before filing. Your county of residence will determine where you file your bankruptcy petition (New Haven, Hartford, or Bridgeport).
• You must complete a mandatory credit counseling course within 180 days of your filing date. You must complete the course at an approved provider and submit a copy of your “Certificate of Completion” when you file your bankruptcy paperwork.
• You must submit your bankruptcy petition along with the requisite filing fee: $338 for Chapter 7 and $313 for Chapter 13. If you cannot afford the fee, you can request a fee waiver from the court. You can also ask to pay the fee in four installments.

There are also separate requirements depending on the type of bankruptcy you plan to file. We will discuss these in detail below.

Eligibility Requirements for Chapter 7 Bankruptcy in Connecticut

To file for Chapter 7, a debtor must first pass something called the “Means Test.” This test requires that your annual household income be less than your state’s median household income. For example, as of the second quarter of 2026, the median income for a two-person household in Connecticut was $101,926, and, for a four-person household, the median income level was $155,263. If your income falls below these amounts, you can proceed with your Chapter 7 bankruptcy filing.

The means test calculator below can help you estimate your Chapter 7 eligibility. However, it’s best to meet with a local bankruptcy attorney to go over your options in detail.

Chapter 7 Means Test Calculator

Estimate your eligibility for Chapter 7 bankruptcy

If, however, you earn more than the state’s median income level, you must pass another test to qualify. This second-chance test determines your disposable income by subtracting your monthly expenses from your monthly income. If the calculation shows that you have little disposable income each month, the court will more than likely allow you to file a Chapter 7 bankruptcy petition.

How to Qualify for Chapter 13 Bankruptcy in Connecticut

To file under Chapter 13, you must demonstrate two things. First, you must show that you have sufficient regular income to make monthly payments to the trustee during your repayment plan. Second, you cannot owe more than the maximum amount of secured and unsecured debt allowable under the federal bankruptcy laws.

To qualify for a Chapter 13 bankruptcy, your debts cannot exceed the following amounts:

• Unsecured debt: $526,700
• Secured debt: $1,580,125

Unsecured debt is financial obligations that are not tied to property. For example, credit card debts and medical bills are unsecured debts. While the creditor can pursue collection action against you, they cannot repossess any property if you fail to pay your debt.

Secured debts are those loans and other accounts that are tied to some form of collateral. Some of the more common types of secured debt are mortgages and car loans. If you don’t pay your mortgage, the lender will initiate foreclosure action against your home. If you fail to pay your car payments on time, the finance company can repossess your motor vehicle.

If your total debts fall under the above limits, you should be able to file your Chapter 13 bankruptcy case without issue. However, if you owe more than this, you will not qualify for this type of bankruptcy. You may have to convert your petition to a Chapter 11 bankruptcy instead.

Documentation You Must Submit with Your Bankruptcy Petition

If you expect the bankruptcy court to accept and process your bankruptcy petition, you must provide the court with certain documentation. Gather this information before you file your petition. It will save you time, money, and a big headache.

Because the bankruptcy process can be overwhelming, many debtors seek legal advice from a Connecticut bankruptcy attorney before they file anything with the court. Your lawyer will ensure that you file your petition properly and that you take advantage of any available bankruptcy exemptions.

Some of the information you must provide to the court and your bankruptcy trustee includes, but is not limited to, the following:

• Six months’ worth of pay stubs
• The last two (or four) years’ tax returns
• Bank account statements
• Statements for any investment accounts
• A list of assets, along with recent appraisals as required
• A schedule of your debts, broken down into secured debts, unsecured debts, and priority unsecured debts (student loans, recent tax debts, etc.)
• Property documentation such as deed, title to motor vehicle, etc.
• A list of any judgments or liens
• Copies of any loan agreements, credit card agreements, etc.

If you don’t submit the above information, the bankruptcy trustee may request specific documents or dismiss your case. It’s best to have your Connecticut bankruptcy attorney review your paperwork before you submit it to the court.

If the court rejects your petition, you will have to start all over and possibly pay the filing fee again.

Connecticut Bankruptcy Exemptions

One reason many people are reluctant to file bankruptcy is that they don’t want to lose their home and other assets. For example, if you have a lot of equity in your home, you may fear that the trustee will sell it and use the proceeds to pay your creditors.

The good news is that every state, including Connecticut, provides debtors with a set of exemptions that help protect their property. The type and amount of state exemptions vary. Some states, such as Connecticut, are very generous when it comes to exemptions.

For instance, under Connecticut bankruptcy laws, you can exempt up to $250,000 of the equity in your home. As long as you have owned the house for more than 1215 days (about 40 months) and use it as your primary residence, you can claim the state homestead exemption.

If you have not owned the home for the requisite 1215 days, you can claim either the federal homestead exemption or that of the state you lived in previously.

Other states, such as New Jersey and Pennsylvania, do not offer debtors any home exemption. Debtors in these states have no choice but to claim the federal bankruptcy exemptions to protect their nonexempt property.

Homestead Exemption

Connecticut lets you exempt up to $250,000 of the equity you have in your home. Married couples can claim up to $500,000 in home equity. This is because married couples who file bankruptcy in Connecticut get to double most exemption amounts.

The homestead exemption applies to the equity you may have in any real property that serves as a dwelling, including:

• Single-family home
• Condominium
• Manufactured home
• Mobile home
• Trailer

When you first sit down with your Connecticut bankruptcy lawyer, they’ll go over the state exemptions and help you decide whether you wish to claim them or the federal exemptions. If you own your home, it makes sense to opt for the state exemptions. The federal homestead exemption amount is much lower than the state exemption.

Note: The federal homestead exemption is $31,575 (or $63,150 for married couples). This is much lower than the Connecticut homestead exemption.

Personal Property Exemption

Connecticut is one of the few states that does not limit the amount of personal property you can exempt from bankruptcy.

The following items qualify as personal property for bankruptcy purposes:

• Furniture
• Appliances
• Clothing
• Wedding and engagement rings
• Food
• Necessary health aids
• Burial plot
• The insurance proceeds paid for damage to exempt property
• Spendthrift trusts that are necessary to support you or your family

Motor Vehicle Exemption

You can exempt up to $3,500 of the equity you have in up to two motor vehicles. ($7,000 total exemption for married couples.)

Wildcard Exemption

You can apply the $1,000 wildcard exemption to any property you own.

Tools of the Trade Exemption

Connecticut completely exempts “tools of the trade.” This includes any equipment, books, supplies, or other property you need to maintain your income.

Insurance Benefits Exemption

The following insurance benefits are exempt:

• Some life insurance proceeds and unmatured life insurance contracts
• Health or disability benefits
• Fraternal benefit society benefits

Pension and Retirement Exemptions

Most pension and retirement plans are exempt in Connecticut, including:

• Tax-exempt retirement accounts such as 401(k)s, IRAs, and defined benefit plans
• State and municipal employee plans
• Teacher plans
• Plans for probate judges and employees

Public Benefit Exemptions

The following public benefits are exempt in Connecticut:

• Social Security benefits
• Unemployment compensation
• Wages from an earning incentive program
• Workers’ compensation benefits
• Crime victims’ compensation
• Veterans’ benefits
• Aid to the aged, blind, disabled, or families with dependent children (AFDC)

Work closely with your Connecticut bankruptcy attorney to make the most of these exemptions.

How to File Bankruptcy in Connecticut

Regardless of the type of bankruptcy you’re filing, the process is generally the same. Of course, there are a few key differences that we will discuss in more detail here.

Before you file your bankruptcy petition, you must complete a mandatory credit counseling course. You must complete the course within 180 days of your bankruptcy filing. It costs anywhere from $10 to $50 to take the class, and you can request a fee waiver if you cannot afford it.

When you submit your paperwork to the bankruptcy court, you must attach a copy of your “Certificate of Completion.”

Once you file your bankruptcy petition with the court, it will provide you with a case number and assign a trustee to your case. If you file Chapter 7, you must include the “Statement of Intention” form, which alerts the trustee as to whether you intend to keep any assets. It also lets them know if you plan to claim any exemptions.

In a Chapter 13 case, you must submit a proposed repayment plan. The trustee wants to see that you are willing and able to commit to a repayment schedule with your creditors. If they approve your plan, your case will proceed. If not, they will either recommend changes or suggest that you convert your case to a Chapter 7.

The Automatic Stay

Once you file your petition, it will trigger the “Automatic Stay.” This bankruptcy mechanism prohibits creditors from taking collection action against you during bankruptcy proceedings.

The automatic stay puts a stop to the following types of collection activity:

• Wage garnishment
• Civil lawsuits
• Foreclosure
• Repossession
• Bank account levy
• Sheriff’s sale
• Collection letters and calls

The whole point of filing bankruptcy is to achieve debt relief. That can hardly happen if your creditors are allowed to continue to pursue payment of the very debts you are trying to resolve through your bankruptcy case.

Need Help Filing for Bankruptcy in Connecticut?

If you are having trouble paying your bills, bankruptcy may be an option. While some bankruptcy cases are straightforward, even simple bankruptcy cases can involve complex court filings. An experienced Connecticut bankruptcy attorney will help guide you through the filing process, represent you in court, and negotiate with creditors to ensure that you retain as many of your assets as the law allows.