This page details and explains Connecticut Bankruptcy Exemptions laws and how they can help your specific case.
Laws that protect your property from creditors
Exemptions are laws passed by every state that allow you to protect certain types of your property from your creditors when you file bankruptcy-such as your home, car, pensions and IRAs, motor vehicles, clothing, tools, and other important property.
Connecticut law provides a number of exemptions that protect your property, and Attorney Dave Falvey will be able to advise you on which exemptions are best for you.
Have Connecticut Exemption Laws Changed?
Answer: Yes, but the new laws are not yet in effect
Connecticut Exemptions have been modified as of October 1, 2022 (10/01/2022). The New Connecticut Homestead Exemption is $250,000 per person. However, this Exemption is currently being challenged in Court as applying only to debts incurred after October 1, 2022 which means that the law is prospective according to the creditors.
Bankruptcy Judge Tancredi has ruled that the new Homestead Exemption applies to all debts regardless of when they were incurred and the new law is retroactive and applies to debts incurred before October 1, 2022 and after October 1, 2022.
Most debt at this time has been incurred before October 1, 2022.
There are other amendments to Connecticut’s New Exemptions but these too are influx and it is dangerous to fully rely on them when filing a bankruptcy petition. It has been said that the ‘new Exemptions are not yet operational’ and if you relied on them and filed a bankruptcy petition, you could encounter a problem. Why? Depending on the outcome of the case In RE: COLE which is challenging how the new law is to be applied, you could lose your home! We can help.
As for the In RE: COLE case, it is on Appeal at this time and is before the Connecticut Supreme Court. The case has been fully briefed and oral arguments were held in December of 2022. Everyone is patiently waiting for the Connecticut Supreme Court’s decision on this matter.
As I said in one of my previous article about CT exemptions, ‘May you be born during interesting times’ which is actually considered an an old Chinese curse.
By way of note, I testified before the Connecticut Judicial Committee in favor of the proposed legislation which I never thought would actually doubted would be enacted into law and since the New Homestead Exemption is being challenged, all the ‘new exemptions’ can be challenged too.
Current Connecticut State Exemptions
75 percent of disposable earnings are exempt.
$1,500 exemption for motor vehicle.
100 percent exemption for the following property: necessary apparel, bedding, foodstuffs, household furniture and appliances; necessary tools, books, instruments, farm animals and livestock feed; wedding and engagement rings; and hearing aids.
Please understand that this information is provided for illustration purposes only and is not legal advice. If you would like more information about exemptions, please call our 24-hour hot-line at 860-449-1510 or use our Free online evaluation form to get started with your bankruptcy case today!
Connecticut State bankruptcy exemptions laws
These are the bankruptcy exemption laws for the state of Connecticut. Reading through these laws will further help you understand how exemptions keep creditor’s hands off your property.
Sec. 52-352b Exempt property
The following property of any natural person shall be exempt:
- (a) Necessary apparel, bedding, foodstuffs, household furniture and appliances;
- (b) Tools, books, instruments, farm animals and livestock feed, which are necessary to the exemptioner in the course of his or her occupation, profession or farming operation;
- (c) Burial plot for the exemptioner and his or her immediate family;
- (d) Public assistance payments and any wages earned by a public assistance recipient under an incentive earnings or similar program;
- (e) Health and disability insurance payments;
- (f) Health aids necessary to enable the exemptioner to work or to sustain health;
- (g) Workers’ compensation, Social Security, veterans and unemployment benefits;
- (h) Court-approved payments for child support;
- (i) Arms and military equipment, uniforms or musical instruments owned by any member of the militia or armed forces of the United States;
- (j) One motor vehicle to the value of three thousand five hundred dollars, provided value shall be determined as the fair market value of the motor vehicle less the amount of all liens and security interests which encumber it;
- (k) Wedding and engagement rings;
- (l) Residential utility deposits for one residence, and one residential security deposit;
- (m) Any assets or interests of an exemptioner in, or payments received by the exemptioner from, a plan or arrangement described in section 52-321a;
- (n) Alimony and support, other than child support, but only to the extent that wages are exempt from execution under section 52-361a;
- (o) An award under a crime reparations act;
- (p) All benefits allowed by any association of persons in this state towards the support of any of its members incapacitated by sickness or infirmity from attending to his usual business;
- (q) All moneys due the exemptioner from any insurance company on any insurance policy issued on exempt property, to the same extent that the property was exempt;
- (r) Any interest of the exemptioner in any property not to exceed in value one thousand dollars;
- (s) Any interest of the exemptioner not to exceed in value four thousand dollars in any accrued dividend or interest under, or loan value of, any unmatured life insurance contract owned by the exemptioner under which the insured is the exemptioner or an individual of whom the exemptioner is a dependent;
- (t) The homestead of the exemptioner to the value of seventy-five thousand dollars, or, in the case of a money judgment arising out of services provided at a hospital, to the value of one hundred twenty-five thousand dollars, provided value shall be determined as the fair market value of the real property less the amount of any statutory or consensual lien which encumbers it; and
- (u) Irrevocable transfers of money to an account held by a debt adjuster licensed pursuant to sections 36a-655 to 36a-665, inclusive, for the benefit of creditors of the exemptioner.
52-361a. Execution on wages after judgment.
- Application. If a judgment debtor fails to comply with an installment payment order, the judgment creditor may apply to the court for a wage execution. The application shall contain the judgment creditor’s or his attorney’s statement setting forth the particulars of the installment payment order and of the judgment debtor’s failure to comply. The application shall be accompanied by a fee of thirty-five dollars payable to the clerk of the court for the administrative costs of complying with the provisions of this section which fee may be recoverable by the judgment creditor as a taxable cost of the action.
- Issuance. On receipt of the application, a clerk of the Superior Court shall issue a wage execution against the judgment debtor, directed to a levying officer, to enforce payment of the judgment.
- Contents. The wage execution shall state;
- the names and last-known addresses of the judgment creditor and judgment debtor
- the court in which and the date on which the money judgment was rendered
- the original amount of the money judgment and the amount due thereon
- any limitation on the execution ordered by the court pursuant to a motion for modification thereof
- the portion of the judgment debtor’s earnings which are subject to levy thereunder, or the information necessary to determine such portion
- any information which the judgment creditor provides to identify the judgment debtor’s employer. The wage execution shall notify any employer of the manner prescribed by this section for complying with the execution and shall be accompanied by a notice of judgment debtor rights and a claim form as prescribed by section 52-361b.
- Levy. The levying officer shall levy on all earnings which are due or become due to the judgment debtor to the extent specified in the wage execution plus the levying officer’s fee and costs, until the judgment is satisfied, or the execution is modified or set aside, by serving the employer with the wage execution, the required notice of rights and the claim forms. On receipt thereof, the employer shall forthwith deliver a copy thereof to the judgment debtor, or mail such copy postage prepaid to the judgment debtor at his last-known address. On service of the wage execution on the employer, the wage execution shall automatically be stayed for a period of twenty days and shall thereafter immediately become a lien and continuing levy on such portion of the judgment debtor’s earnings as is specified in the wage execution, provided if a claim is filed in accordance with subsection (d) of section 52-361b within twenty days of such service on the employer, the stay shall continue until determination of the claim. Any service of process or other notice required under this section may be made in accordance with section 52-57 or by certified mail, return receipt requested, provided a levying officer may make such service by mail only to an address within such officer’s appointed jurisdiction.
- Service and return. A wage execution shall be served within one year from its issuance and returned within thirty days from the satisfaction of the judgment.
- Amount subject to levy. The maximum part of the aggregate weekly earnings of an individual which may be subject under this section to levy or other withholding for payment of a judgment is the lesser of (1) twenty-five per cent of his disposable earnings for that week, or (2) the amount by which his disposable earnings for that week exceed forty times the higher of (A) the minimum hourly wage prescribed by Section 6(a)(1) of the Fair Labor Standards Act of 1938, USC Title 29, Section 206(a)(1), or (B) the full minimum fair wage established by subsection (j) of section 31-58, in effect at the time the earnings are payable. Unless the court provides otherwise pursuant to a motion for modification, the execution and levy shall be for the maximum earnings subject to levy and shall not be limited by the amount of the installment payment order. Only one execution under this section shall be satisfied at one time. Priority of executions under this section shall be determined by the order of their presentation to the employer.
- Employer responsibilities. Any employer served with a wage execution, including the state and any municipality, shall, upon expiration of the automatic stay of execution and subject to any further stay pursuant to a claim, pay over to the levying officer such portion of the judgment debtor’s nonexempt earnings as the execution prescribes until the judgment is satisfied or the execution modified or set aside. The payments to the levying officer in compliance with the execution shall bar any action against the employer for such payments. If the employer fails or refuses to pay the earnings levied against to the levying officer, the employer may be subjected to a turnover order pursuant to section 52-356b and, on a finding of contempt, may be held liable to the judgment creditor for any amounts which he has so failed or refused to pay over. Any amount so recovered by the judgment creditor shall be applied toward payment of the judgment.
- Modification. Either party may apply at any time to the court which issued the wage execution for a modification of the execution. After notice and hearing or pursuant to a stipulation, the court may make such modification of the execution as is reasonable.
- Assignment of earnings. Any assignment by an employee of his earnings shall be void except (1) payments due for support in public welfare cases and payments pursuant to a family support judgment, and (2) deductions for union dues and initiation fees in accordance with the terms of a duly executed contract between an employer and his employees or a collective bargaining agent or in accordance with a duly executed authorization signed by the employee for the payment of such dues or initiation fees or both to such collective bargaining agent.
- Unlawful discipline, suspension or discharge. Notwithstanding any other provision of the general statutes to the contrary, no employer may discipline, suspend or discharge an employee because of any wage execution against the employee unless the employer is served with more than seven wage executions against the employee in a calendar year. An employer who violates this subsection shall be liable to the employee for all earnings and all employment benefits lost by the employee from the time of the unlawful discipline, suspension or discharge to the time of reinstatement.
- Status of defendant. Notwithstanding any provision of law, the remedy provided by this section shall be available to any judgment creditor and the status of the defendant as an elected or appointed official of any branch of the government of this state may not be interposed as a defense.
30-14. Nature and duration of permit. Renewal by transferer or purchaser of permit premises.
- A permit shall be a purely personal privilege that expires annually, except a permit issued under sections 30-25, 30-35, 30-37b, 30-37d, 30-37g and 30-37h, and revocable in the discretion of the Department of Consumer Protection subject to appeal as provided in section 30-55. A permit shall not constitute property, nor shall it be subject to attachment and execution, nor shall it be alienable, except that it shall descend to the estate of a deceased permittee by the laws of testate or intestate succession. A railroad permit or an airline permit shall be granted to the railroad corporation or airline corporation and not to any person, and the corporation shall be the permittee.
- Any permit in this part, except a permit issued under sections 30-25, 30-35, 30-37b, 30-37d, 30-37g and 30-37h, may be issued for a continuous period of not more than six consecutive calendar months, at two-thirds of regular fees, but rebate of fees shall not be permitted for any unexpired portion of the term of a permit revoked by reason of a violation of any provision of this chapter.
- The executors or administrators of the estate of any deceased permittee, and the trustees of any insolvent or bankrupt estate of a permittee, when such estate consists in whole or in part of alcoholic liquor, may continue the business of the sale or manufacture of alcoholic liquor under order of the appropriate court and may exercise the privileges of the deceased or insolvent or bankrupt permittee for a period not exceeding six months after the date of such decease or of such insolvency or bankruptcy, or until such time as the applicable permit expires, whichever date is later. A certified copy of the order of the court authorizing the continuance of such business shall be filed with the department. In the event of the death, insolvency or bankruptcy of a backer, the permittee of such backer shall have the same rights and privileges as set forth in this section, provided, in addition to the order of said court, the executor or administrator of the estate of any deceased backer, or the trustee of any insolvent or bankrupt estate of a backer, shall file a notice with the department that he has authorized such permittee to continue such business.
- Notwithstanding any provision of this section, a package store permit may be renewed by a transferee or purchaser of permit premises under section 30-14a.
38a-637. Money Or Other Benefits Not Liable To Attachment.
No money or other benefit, charity, relief or aid to be paid, provided or rendered by any society shall be liable to attachment, garnishment or other process, or to be seized, taken, appropriated or applied by any legal or equitable process or operation of law to pay any debt or liability of a member or beneficiary, or any other person who may have a right thereunder, either before or after payment by the society.
38a-453. Rights Of Creditors Of Insured Against Beneficiary.
- The beneficiary of any life insurance policy, being a person other than the insured, whether named as beneficiary in the original policy or subsequently named as beneficiary in accordance with the terms of the policy, shall be entitled to the proceeds of the policy as against the representatives or creditors of the insured, unless the policy was procured or the designation of a beneficiary was made with intent, express or implied, to defraud creditors.
- If any such policy was procured or any such designation made with the intent, express or implied, to defraud creditors, the proceeds thereof shall become a part of the estate of the insured, and the executor or administrator of the estate shall collect the insurance and use the proceeds thereof so far as it is required for the expenses of administration and the payment of debts and pay over the balance, if any, to the beneficiary of the policy. If any premiums paid on the insurance policy were paid with the intent, express or implied, to defraud creditors, the amount of the premiums so paid, with interest thereon, shall become a part of the estate and shall be dealt with as above provided.
- The company issuing the policy shall be discharged of all liability thereunder by payment of the proceeds in accordance with the terms of the policy unless, before such payment, the company has received written notice, from a creditor, executor or administrator of the insured, that the policy was procured or premiums were paid thereon with intent to defraud creditors. That notice may be disregarded by the company unless proper legal proceedings to enforce the claim are begun within three months from the giving of the notice.
- This section shall apply to any policy of insurance issued before July 1, 1933, but not to policies which matured by the death of the insured before July 1, 1933.
10-183q. Funds Not Assignable And Exempt From Attachment.
The portion of each member’s compensation deducted or to be deducted under this chapter and all rights of each member and of each survivor to receive benefits or other payments under this chapter shall be exempt from the operation of any laws relating to bankruptcy or insolvency; and shall not be subject to garnishment, attachment, execution, levy or any other similar legal process of any court.
No assignment of any right of a member or any other person to receive benefits or other payments from the system shall be valid. The funds of the system invested in personal property shall be exempt from taxation.