Arkansas Bankruptcy Exemptions 2026
Complete guide to what property you can keep when filing bankruptcy in Arkansas
Unlimited
Homestead Exemption
$1,200
Vehicle Exemption (State)
Choice
State or Federal Exemptions
2 Districts
E.D. Ark. & W.D. Ark.
Arkansas has an unlimited homestead exemption under the state constitution (Art. 9, Sections 3-4). There is no dollar cap on equity. The property must be your principal residence and cannot exceed 1/4 acre in a city/town or 80 acres in a rural area. You must have owned the property for at least 40 days before filing.
Arkansas Exemptions Chart
| Asset Type | Exemption Amount | Statute |
|---|
| Homestead | Unlimited value; 1/4 acre (city) or 80 acres (rural) | Ark. Const. Art. 9, Sec. 3-4 |
| Vehicle | $1,200 | Ark. Code Ann. 16-66-218(b)(3) |
| Personal property | $500 per item (clothing, furniture); $200 wedding rings | Ark. Code Ann. 16-66-218 |
| Wages | First $25/week earned plus 60 days wages | Ark. Code Ann. 16-66-208 |
| Retirement accounts | Fully exempt (ERISA-qualified) | Ark. Code Ann. 16-66-218(b)(16) |
| IRA | Fully exempt (traditional + Roth) | Ark. Code Ann. 16-66-218(b)(16) |
| Life insurance | Cash value up to $500; group policy fully exempt | Ark. Code Ann. 16-66-209; 23-79-131 |
| Public benefits | Fully exempt (unemployment, workers' comp, crime victims) | Various |
| Wildcard | None under state; $1,475 + $13,950 unused homestead under federal | 11 U.S.C. 522(d)(5) |
Arkansas Homestead Exemption Details
Arkansas has one of the most generous homestead exemptions in the country - unlimited dollar value - limited only by acreage:
- Urban: 1/4 acre in a city or town
- Rural: 80 acres outside city limits
- Must be your principal residence
- Must have owned for at least 40 days before filing
- The 730-day federal domicile rule applies if you recently moved to Arkansas (11 U.S.C. 522(b)(3)(A))
Important: If you recently bought an expensive home to shelter assets before bankruptcy, the BAPCPA cap of $189,050 may apply under 11 U.S.C. 522(p). This targets pre-filing asset conversion.
State vs. Federal Exemptions in Arkansas
Arkansas allows debtors to choose between state and federal exemption systems. You cannot mix and match. Key considerations:
- Choose state exemptions if: You have significant home equity (unlimited vs. $27,900 federal) or own rural acreage
- Choose federal exemptions if: You rent or have little home equity - the federal wildcard ($1,475 + up to $13,950 of unused homestead = $15,425) protects more personal property, and the vehicle exemption is $4,450 vs. $1,200 under state law
Important Notes for Arkansas Filers
- Low vehicle exemption under state law: Only $1,200. If you have significant car equity, consider using federal exemptions ($4,450 + potential wildcard)
- Marriage doubles exemptions: Married couples filing jointly can each claim the full exemption amounts
- Two bankruptcy districts: Eastern District (Little Rock) and Western District (Fort Smith). Local rules may differ
- Strong retirement protection: All ERISA-qualified plans and IRAs are fully exempt under both state and federal systems
Foundational Caselaw
The cases below define the doctrine on this site:
- Schwab v. Reilly, 560 U.S. 770 (2010) - when a debtor claims a specific dollar amount in exemption schedules, only that amount is exempt; the trustee can sell appreciated value above the claimed amount without filing a Section 522(l) objection. Choosing whether to claim "value" or "in full" controls the outcome.
- Law v. Siegel, 571 U.S. 415 (2014) - bankruptcy courts may not surcharge exempt property to satisfy administrative expenses arising from the debtor's misconduct; the bankruptcy court's general equitable powers under Section 105(a) cannot override express provisions of the Code (here, Section 522(k)).
Related Resources
Full Arkansas Bankruptcy Guide | Homestead Exemptions by State | Federal Exemptions (Section 522(d)) | Means Test Calculator | How to File Bankruptcy in Arkansas