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 New Mexico, bankruptcy exemptions play a crucial role in protecting certain assets of individuals filing for bankruptcy. These exemptions are designed to allow debtors to retain enough property to facilitate a fresh start after bankruptcy. New Mexico allows debtors to choose between the state's bankruptcy exemptions and the federal bankruptcy exemptions, but not both. This means that a debtor can decide which set of exemptions is more favorable for their situation. The New Mexico exemptions cover a variety of assets, including homestead, personal property, tools of the trade, wages, pensions, public benefits, and insurance among others. It's important for debtors to review both the state and federal exemptions carefully with the assistance of an attorney to determine the best option for their individual circumstances.