Arizona Bankruptcy Exemptions
Complete exemption laws which protect a debtor’s property when personal bankruptcy is filed in the state of Arizona.
33-1101. Arizona homestead exemptions; persons entitled to hold homesteads
A. Any person the age of eighteen or over, married or single, who resides within the state may hold as a homestead exempt from attachment, execution and forced sale, not exceeding one hundred fifty thousand dollars in value, any one of the following:
1. The person’s interest in real property in one compact body upon which exists a dwelling house in which the person resides.
2. The person’s interest in one condominium or cooperative in which the person resides.
3. A mobile home in which the person resides.
4. A mobile home in which the person resides plus the land upon which that mobile home is located.
B. Only one homestead exemption may be held by a married couple or a single person under this section. The value as specified in this section refers to the equity of a single person or married couple. If a married couple lived together in a dwelling house, a condominium or cooperative, a mobile home or a mobile home plus land on which the mobile home is located and are then divorced, the total exemption allowed for that residence to either or both persons shall not exceed one hundred fifty thousand dollars in value.
C. The homestead exemption, not exceeding the value provided for in subsection A, automatically attaches to the person’s interest in identifiable cash proceeds from the voluntary or involuntary sale of the property. The homestead exemption in identifiable cash proceeds continues for eighteen months after the date of the sale of the property or until the person establishes a new homestead with the proceeds, whichever period is shorter. Only one homestead exemption at a time may be held by a person under this section.
33-1123. Household furniture, furnishings and appliances
The following household furniture, furnishings and appliances personally used by the debtor are exempt from process provided their aggregate fair market value does not exceed four thousand dollars:
1. One kitchen and one dining room table with four chairs each, plus one additional chair for each dependent of the debtor who resides in the household if the debtor and dependents exceed four in number.
2. One living room couch.
3. One living room chair, plus one additional chair for each dependent of the debtor who resides in the household.
4. Three living room coffee or end tables.
5. Three living room lamps.
6. One living room carpet or rug.
7. Two beds, plus one additional bed for each dependent of the debtor who resides in the household.
8. One bed-table, dresser and lamp for each bed allowed by paragraph 7.
9. Bedding for each bed allowed by this section.
10. Pictures, oil paintings and drawings, drawn or painted by debtor and family portraits in their necessary frames.
11. One television set or radio or stereo.
12. One radio alarm clock.
13. One stove.
14. One refrigerator.
15. One washing machine.
16. One clothes dryer.
17. One vacuum cleaner.
33-1124. Food, fuel and provisions
All food, fuel and provisions actually provided for the debtor’s individual or family use for six months are exempt from process.
33-1125. Personal items
The following property of a debtor used primarily for personal, family or household purposes shall be exempt from process:
1. All wearing apparel not in excess of a fair market value of five hundred dollars.
2. All musical instruments provided for the debtor’s individual or family use not in excess of an aggregate fair market value of two hundred fifty dollars.
3. Domestic pets, horses, milk cows and poultry not in excess of an aggregate fair market value of five hundred dollars.
4. All engagement and wedding rings not in excess of an aggregate fair market value of one thousand dollars.
5. The library of a debtor, including books, manuals, published materials and personal documents not in excess of an aggregate fair market value of two hundred fifty dollars.
6. One watch not in excess of a fair market value of one hundred dollars.
7. One typewriter, one bicycle, one sewing machine, a family bible, a lot in any burial ground, one shotgun or one rifle or one pistol, not in excess of an aggregate fair market value of five hundred dollars.
8. One motor vehicle not in excess of a fair market value of five thousand dollars. If the debtor is physically disabled, the fair market value of the motor vehicle shall not exceed ten thousand dollars.
9. Professionally prescribed prostheses for the debtor or a dependent of the debtor, including a wheelchair.
33-1126. Money benefits or proceeds; exception
A. The following property of a debtor shall be exempt from execution, attachment or sale on any process issued from any court:
1. All money received by or payable to a surviving spouse or child upon the life of a deceased spouse, parent or legal guardian, not exceeding twenty thousand dollars.
2. The earnings of the minor child of a debtor or the proceeds thereof by reason of any liability of such debtor not contracted for the special benefit of such minor child.
3. All monies received by or payable to a person entitled to receive child support or spousal maintenance pursuant to a court order.
4. All money, proceeds or benefits of any kind to be paid in a lump sum or to be rendered on a periodic or installment basis to the insured or any beneficiary under any policy of health, accident or disability insurance or any similar plan or program of benefits in use by any employer, except for premiums payable on such policy or debt of the insured secured by a pledge, and except for collection of any debt or obligation for which the insured or beneficiary has been paid under the plan or policy and except for payment of amounts ordered for support of a person from proceeds and benefits furnished in lieu of earnings which would have been subject to such order and subject to any exemption applicable to earnings so replaced.
5. All money arising from any claim for the destruction of, or damage to, exempt property and all proceeds or benefits of any kind arising from fire or other insurance upon any property exempt under this article.
6. The cash surrender value of life insurance policies where for a continuous unexpired period of two years such policies have been owned by a debtor and have named as beneficiary the debtor’s surviving spouse, child, parent, brother or sister, or any other dependent family member, in the proportion that the policy names any such beneficiary, except that, subject to the statute of limitations, the amount of any premium which is recoverable or avoidable by a creditor pursuant to title 44, chapter 8, article 1, with interest thereon, shall not be exempt. The exemption provided by this paragraph does not apply to a claim for the payment of a debt of the insured or beneficiary that is secured by a pledge or assignment of the cash value of the insurance policy or the proceeds of the policy. For the purposes of this paragraph “dependent” means a family member who is dependent on the insured debtor for not less than half support.
7. An annuity contract where for a continuous unexpired period of two years such contract has been owned by a debtor and has named as beneficiary the debtor, debtor’s surviving spouse, child, parent, brother or sister, or any other dependent family member, except that, subject to the statute of limitations, the amount of any premium, payment or deposit with respect to such contract is recoverable or avoidable by a creditor pursuant to title 44, chapter 8, article 1 shall not be exempt. The exemption provided by this paragraph does not apply to a claim for a payment of a debt of the annuitant or beneficiary that is secured by a pledge or assignment of the contract or its proceeds. For the purposes of this paragraph, “dependent” means a family member who is dependent on the debtor for not less than half support.
8. Any claim for damages recoverable by any person by reason of any levy upon or sale under execution of his exempt personal property or by reason of the wrongful taking or detention of such property by any person, and the judgment recovered for such damages.
9. A total of one hundred fifty dollars held in a single account in any one financial institution as defined by section 6-101. The property declared exempt by this paragraph is not exempt from normal service charges assessed against the account by the financial institution at which the account is carried.
B. Any money or other assets payable to a participant in or beneficiary of, or any interest of any participant or beneficiary in, a retirement plan under section 401(a), 403(a), 403(b), 408, 408A or 409 or a deferred compensation plan under section 457 of the United States internal revenue code of 1986, as amended, shall be exempt from any and all claims of creditors of the beneficiary or participant. This subsection shall not apply to any of the following:
1. An alternate payee under a qualified domestic relations order, as defined in section 414(p) of the United States internal revenue code of 1986, as amended. The interest of any and all alternate payees is exempt from any and all claims of any creditor of the alternate payee.
2. Amounts contributed within one hundred twenty days before a debtor files for bankruptcy.
3. The assets of bankruptcy proceedings filed before July 1, 1987.
C. Any person the age of eighteen years or over, married or single, who resides within this state and who does not exercise the homestead exemption under article 1 of this chapter may claim as a personal property homestead exempt from all process prepaid rent, including security deposits as provided in section 33-1321, subsection A, for the claimant’s residence, not exceeding the lesser of one thousand dollars or one and one-half months’ rent.
D. Nothing in this section exempts property from orders which are the result of a judgment for arrearages of child support or for a child support debt.
33-1127. School equipment
The library and philosophical and chemical or other apparatus belonging to a debtor and used for the instruction of youth in any university, college, seminary of learning, or school shall be exempt from execution, attachment or sale on any process issued from any court.
33-1130. Tools and equipment used in a commercial activity, trade, business or profession
The following tools and equipment of a debtor used in a commercial activity, trade, business or profession shall be exempt from process:
1. The tools, equipment, instruments and books of a debtor or the spouse of a debtor primarily used in, and necessary to carry on, the commercial activity, trade, business or profession of the debtor or the debtor’s spouse, not in excess of an aggregate fair market value of two thousand five hundred dollars. For the purpose of this paragraph, “tools” do not include a motor vehicle primarily used by a debtor for personal, family or household purposes such as transportation to and from the debtor’s place of employment.
2. Farm machinery, utensils, implements of husbandry, feed, seed, grain and animals not in excess of an aggregate value of two thousand five hundred dollars belonging to a debtor whose primary income is derived from farming.
3. All arms, uniforms and accoutrements required by law to be kept by a debtor.
33-1131. Definition; wages; salary; compensation
A. For the purposes of this section, “disposable earnings” means that remaining portion of a debtor’s wages, salary or compensation for his personal services, including bonuses and commissions, or otherwise, and includes payments pursuant to a pension or retirement program or deferred compensation plan, after deducting from such earnings those amounts required by law to be withheld.
B. Except as provided in subsection C, the maximum part of the disposable earnings of a debtor for any workweek which is subject to process may not exceed twenty-five per cent of disposable earnings for that week or the amount by which disposable earnings for that week exceed thirty times the minimum hourly wage prescribed by federal law in effect at the time the earnings are payable, whichever is less.
C. The exemptions provided in subsection B do not apply in the case of any order for the support of any person. In such case, one-half of the disposable earnings of a debtor for any pay period is exempt from process.
D. The exemptions provided in this section do not apply in the case of any order of any court of bankruptcy under chapter XIII of the federal bankruptcy act or any debt due for any state or federal tax.
33-1133. Other exemption laws
A. Nothing in this article shall be construed to displace other provisions of law which afford additional or greater protection to a debtor’s property.
B. Notwithstanding subsection A, in accordance with 11 U.S.C. 522 (b), residents of this state are not entitled to the federal exemptions provided in 11 U.S.C. 522 (d). Nothing in this section affects the exemptions provided to residents of this state by the constitution or statutes of this state.
9-931. Exemption of pensions from process; prohibition on assignments; exception (Police officers)
A. No pension allowed under this article shall be subject to garnishment, attachment, judgment, execution or other legal process. No person entitled to a pension shall have the right to assign it, nor shall the board recognize an attempted assignment of the pension or pay over any sum which has been assigned or attempted to be assigned.
B. Nothing in this section exempts property from court orders which are the result of a judgment for arrearages of child support or for a child support debt.
9-968. Exemption of pension from process; prohibition of assignments; exception (Firefighters)
A. No portion of the pension fund or the distributive portions thereof shall be subject to attachment, execution or other judicial process for the satisfaction of a debt or claim against the member or his beneficiaries, and assignments or transfers of any distributive portion shall be void.
B. Nothing in this section exempts property from court orders which are the result of a judgment for arrearages of child support or for a child support debt.
12-592. Exemption of benefits (Wrongful death awards)
Periodic installments for future damages for loss of earnings or loss of support for beneficiaries of a judgment entered in a wrongful death action are exempt from garnishment, attachment, execution and any other process or claim to the extent wages or earnings are exempt under any applicable law. Periodic installments for all other future damages are exempt under garnishment, attachment, execution and any other process or claim except to the extent they may be assigned pursuant to section 12-591.
23-783. Assignment or pledge of benefits void; exemption from attachment or execution; waiver of exemption void (Unemployment compensation)
A. No assignment, pledge or encumbrance of the right to benefits which are or may become due or payable under this chapter shall be valid, and the rights to benefits shall be exempt from levy, execution, attachment or any other remedy provided for the collection of debts. Benefits received by an individual, as long as they are not commingled with other funds of the recipient, shall be exempt from any remedy for the collection of all debts except debts incurred for necessaries furnished to the individual or his or her spouse or dependents during the time when the individual was unemployed. No waiver of an exemption provided for in this section shall be valid.
B. This section does not apply to actions to recover child support obligations which are being enforced by the department pursuant to a plan under the child support enforcement act, as amended, which has been approved by the United States secretary of health and human services under part D of title IV of the social security act, as amended.
C. This section does not apply to actions to recover overissuances of food stamp coupons pursuant to section 13(c)(3)(A) or (B) of the food stamp act of 1977.
23-1068. Assignment of compensation; exemption from attachment or execution; payment to nonresident (Workers’ compensation)
A. Compensation, whether determined or not, is not, prior to the delivery of the warrant therefor, assignable.
B. Except as provided in subsection D of this section, compensation is exempt from attachment, garnishment and execution and does not pass to another person by operation of law, except that:
1. The amount of compensation payable to a person at the time of death, whether payable in periodic payments or converted to a lump sum, and whether or not the warrant therefor has been issued or delivered after that person’s death, shall be paid to that person’s personal representative.
2. If medical, wage loss or disability benefits are paid or otherwise provided by an employer to or for the benefit of an employee for an injury or illness for which medical or compensation benefits payable pursuant to this article have been denied or for which a claim for compensation under this article has not been filed, and the injury or illness is subsequently determined to be compensable under this article, the employer or the person authorized by the employer to provide such benefits is entitled to a direct payment out of, or a direct credit against, the medical or compensation benefits payable under this article in the amount of the benefits previously paid or provided.
C. Any dispute as to the amount of the direct payment or credit against the medical or compensation benefits payable shall be resolved pursuant to section 23-1061, subsection J.
D. Compensation is subject to an assignment for the payment of support as defined in section 25-500, spousal maintenance and the fee for handling child support and spousal maintenance payments authorized by section 25-510.
E. Payment to the consular agent, or the consular agent’s representative, of the nation of which a dependent is a resident or subject, of compensation due the dependent residing outside the United States, any power of attorney to receive or receipt for such compensation to the contrary notwithstanding, is a full discharge of the benefits or compensation as if made directly to the beneficiary.
29-1027. Actions by and against partnership and partners
A. A partnership may sue and be sued in the name of the partnership.
B. Except as otherwise provided in subsection F of this section, an action may be brought against the partnership and any or all of the partners in the same action or in separate actions.
C. A judgment against a partnership is not by itself a judgment against a partner. A judgment against a partnership may not be satisfied from a partner’s assets unless there is also a judgment against the partner.
D. A judgment creditor of a partner may not levy execution against the assets of the partner to satisfy a judgment based on a claim against the partnership unless either:
1. The claim is for a debt, obligation or liability for which the partner is liable as provided in section 29-1026 and either: (a) A judgment based on the same claim has been obtained against the partnership and a writ of execution on the judgment has been returned unsatisfied in whole or in part.
(b) The partnership is a debtor in bankruptcy.
(c) The partner has agreed that the creditor need not exhaust partnership assets.
(d) A court grants permission to the judgment creditor to levy execution against the assets of a partner based on a finding that partnership assets subject to execution are clearly insufficient to satisfy the judgment, that exhaustion of partnership assets is excessively burdensome or that the grant of permission is an appropriate exercise of the court’s equitable powers.
2. Liability is imposed on the partner by law or contract independent of the existence of the partnership.
E. This section applies to any partnership liability or obligation resulting from a representation by a partner or purported partner under section 29-1028.
F. A partner is not a proper party to an action against a limited liability partnership where that partner would not be personally liable for the claim under section 29-1026.
32-1391.05. Pre-arranged funeral agreements funded by trusts
A. All monies paid under a pre-arranged funeral agreement funded by trust shall be deposited, within five business days after the receipt of the monies, in a pre-arranged funeral trust account with a financial institution doing business in this state. The monies shall be invested either in federally insured accounts, in which case the amounts so deposited shall not exceed the amount of the deposit insurance, or in direct obligations of the United States government. Federally insured accounts are defined as accounts insured by the federal deposit insurance corporation or the national credit union administration board. If invested in direct obligations of the United States government, the maturity dates of such obligations shall not exceed three years, unless rules adopted by the superintendent of financial institutions permit a longer period and not less than five per cent of the amounts so deposited shall at all times be deposited in federally insured accounts.
B. Except as provided in this article:
1. All monies deposited in a prearranged funeral trust account and all accrued interest shall be held in the trust account for and remain the property of the beneficiary during the beneficiary’s life and of the beneficiary’s estate after the beneficiary’s death.
2. A funeral establishment or another person shall not withdraw, transfer, remove, commingle, encumber or use as collateral any monies paid to the establishment under a prearranged funeral agreement funded by trust.
3. All monies deposited and accrued interest in a prearranged funeral trust account shall be exempt from attachment, garnishment, execution and claims of creditors, receivers and trustees of the funeral establishment other than the claims of the beneficiary or the beneficiary’s estate.
4. All monies deposited and accrued interest in a prearranged funeral trust account up to a total of five thousand dollars shall be exempt from attachment, garnishment, execution and claims of creditors, receivers and trustees of the beneficiary other than the claims of the funeral establishment.
C. A funeral establishment may direct the financial institution in which the trust monies are deposited to transfer the trust account to another financial institution after providing each participant in the trust with the name and location of the institution and the new trust account number.
38-792. Exemptions from execution, attachment and taxation; exception (State employees’ retirement and disability)
9. Beddi allowed by this section.
A. The benefits and annuities, the member and employer contributions and the securities in ASRS accounts provided for in this article are not subject to execution or attachment and are nonassignable except as specifically provided in this article. The member and employer contributions and the securities in ASRS accounts are exempt from state, county and municipal income taxes. Contributions that are withdrawn after December 31, 1974 by a public officer or employee from the accounts of ASRS and that are not received as benefits from ASRS and benefits and annuities received by a public officer or employee from ASRS after December 31, 1988 are subject to tax pursuant to title 43.
B. Interest, earnings and all other credits pertaining to benefits and annuities are not subject to execution or attachment and are nonassignable.
&38-797.11. Exemptions from execution, attachment and taxation; exception (State employees’ retirement and disability)
A. The benefits, the employer and member contributions and the securities in the LTD trust fund established by section 38-797.02 are not subject to execution or attachment and are nonassignable except as specifically provided in this article or article 2 of this chapter. The employer and member contributions and the securities in the LTD trust fund established by section 38-797.02 are exempt from state, county and municipal income taxes. Benefits received by a member from the LTD program are subject to tax pursuant to title 43.
B. Interest, earnings and all other credits pertaining to benefits are not subject to execution or attachment and are nonassignable.
41-955. Pension not subject to process (Rangers)
A. A pension allowed under this article shall not be subject to garnishment, attachment, judgment, execution or other legal process.
B. A person to whom a pension is allowed shall not assign the pension, nor shall any officer or board upon which a duty is imposed with respect to the administration of this article recognize an assignment of such pension or pay any sum whatever which has been thus assigned or attempted to be assigned.
46-208. Nontransferability and nonassignability of assistance; exemption from process (Welfare benefits)
Assistance granted under this title is not transferable or assignable at law or in equity, and none of the money paid or payable under this title shall be subject to execution, levy, attachment, garnishment or other legal process, or to the operation of any bankruptcy or insolvency law.
48-227. Exemption from taxation and execution; exceptions; nonassignability of benefits (District employees)
A. The benefits, annuities and pensions, the employee and district contributions and the securities in which any trust fund provided for in a plan shall be invested shall not be subject to execution or attachment, garnishment, bankruptcy proceedings or other legal process. The securities in the plan’s trust fund are exempt from state, county and municipal taxes, but the benefits, annuities and pensions received by an officer or employee from such a plan after December 31, 1988 are subject to tax pursuant to title 43. B. No participant or beneficiary, or any other person having or claiming to have any interest of any kind or character in or under any plan adopted by a district, or any part thereof, or payment therefrom, shall have any right to sell, assign, transfer, convey, hypothecate, anticipate, or otherwise dispose of such interest.
Note: While this reference information is current as of August 2010, it may not reflect the most up-to-date exemption figures on official state of Arizona bankruptcy court statutes.