Chapter 7 Bankruptcy Lawsuit in Texas

Texas Chapter 7 Exemptions

Texas is an opt-in state: a Texas debtor may use the state exemption set OR elect the federal Section 522(d) exemptions, whichever better fits the debtor's assets. (Source: Nolo, Texas Bankruptcy Homestead Exemption.)

Homestead, Vehicle, and Personal Property

The Texas homestead exemption is unlimited in dollar value but capped by acreage: up to 10 acres in an urban area, 100 acres rural for a single person, or 200 acres rural for a family (Tex. Prop. Code Sections 41.001 to 41.002). One motor vehicle per licensed household member is protected within the $50,000 single / $100,000 family personal-property aggregate (Tex. Prop. Code Sections 42.001 and 42.002(a)(9)). Texas has no separate state wildcard — personal property is capped in aggregate. (Source: Nolo, Texas Bankruptcy Homestead Exemption.)

Acreage caveat: although homestead value is unlimited, a federal cap of $214,000 (effective April 1, 2025) applies to homestead equity acquired within 1,215 days before filing (11 U.S.C. Section 522(p)). Recently acquired equity may not be fully protected even in Texas. (Source: Nolo; 11 U.S.C. Section 522(p).)

Means Test: Texas Median Income

The Chapter 7 means test compares a debtor's six-month average gross income to the state median family income for the household size. For Texas, the U.S. Trustee median family income for a household of four is $117,962 (U.S. Trustee median family income, eff. April 1, 2026; smaller households use lower figures). A debtor below the applicable median is generally not presumed to be abusing Chapter 7; above-median filers complete Form 122A-2. (Source: U.S. Trustee Program, justice.gov/ust.)

Which State's Exemptions Apply

Under the 730-day domicile rule (11 U.S.C. Section 522(b)(3)), a debtor must have been domiciled in Texas for the 730 days before filing to use Texas exemptions; otherwise an earlier state's set or the federal exemptions may apply. This matters for the many residents who move to Texas — the generous homestead is not automatically available right after relocation.

To compare your six-month income against the Texas median, use the Chapter 7 means test calculator at /tools/chapter-7-means-test-calculator. To estimate what property Texas or the federal set might protect, use the bankruptcy exemption estimator at /tools/bankruptcy-exemption-estimator.

Exemption amounts change — verify current figures with an attorney. People's Justice is not a law firm and does not provide legal advice; we connect you with licensed attorneys, and we are not a government agency.