Bankruptcy exemptions are rules that exempt certain types and amounts of property from being sold or used to satisfy the claims of debtors in your bankruptcy case. Each state has a set of bankruptcy exemptions that you can use to protect your property while going through bankruptcy.

Federal law also provides a set of bankruptcy exemptions. Your state’s law will determine whether you can choose the federal bankruptcy exemptions, or if you must use your state’s bankruptcy exemptions. But if your state’s law allows you to choose between the two sets of bankruptcy exemptions, you must choose one or the other, and cannot choose exemptions from both your state and the federal exemptions.

In Illinois, bankruptcy exemptions play a crucial role in protecting certain assets of individuals filing for bankruptcy. Illinois has its own set of bankruptcy exemptions that residents are required to use, as it does not allow debtors to choose the federal bankruptcy exemptions. These exemptions include specific amounts for real property, personal property, insurance, pensions, public benefits, tools of trade, alimony, and child support, among others. For example, the Illinois homestead exemption allows debtors to exempt up to $15,000 of equity in their residence. Additionally, Illinois provides a wildcard exemption that can be applied to any property. It's important for debtors to understand these exemptions as they determine which assets can be kept after filing for bankruptcy. Debtors in Illinois cannot mix and match between state and federal exemptions; they must adhere strictly to the state's exemption list.