Arkansas Bankruptcy Laws

Approximate annual median: 1 person ~$47,000; 2 persons ~$59,000; 3 persons ~$66,000; 4 persons ~$78,000 (updated semi-annually by the U.S. Trustee). Households below the median qualify for Chapter 7 without the full means test calculation.

For married persons or heads of family: unlimited equity on up to 1/4 acre in a city/town/village or 80 acres rural. If the property is between 1/4–1 acre urban or 80–160 acres rural, the additional portion is limited to $2,500 in value. Maximum acreage: 1 acre urban, 160 acres rural. Spouses cannot double the exemption.

The statutory vehicle exemption of $1,200 for one motor vehicle was declared unconstitutional by the U.S. Court of Appeals for the 8th Circuit. As a result, debtors choosing state exemptions have no specific vehicle exemption beyond the constitutional personal property allowance ($200/$500). Debtors choosing federal exemptions can protect significantly more vehicle equity ($4,450 under current federal amounts).

The constitutional wildcard is $200 for single/non-head-of-household persons and $500 for married persons or heads of household. This is among the lowest wildcard exemptions in the nation. Clothing and wedding rings are exempt without limit.

Arkansas allows debtors who have lived in the state for at least 2 years to choose between state and federal bankruptcy exemptions (but cannot mix and match). Federal exemptions are often more favorable, offering $31,575 homestead (doubled for married couples), $4,450 vehicle, and a $1,675 wildcard (+$15,800 of unused homestead).

The greater of 75% of disposable earnings or 30 times the federal minimum wage is exempt from garnishment. Arkansas follows federal garnishment standards under the CCPA.