California Bankruptcy Exemptions
California opted out of the federal bankruptcy exemptions, so filers cannot use the federal § 522(d) set. Instead California offers a choice between two state systems — you must pick one, not mix: the CCP § 704 series (with a large homestead under § 704.730) or the CCP § 703.140(b) bankruptcy-only set (with a wildcard at § 703.140(b)(5)).
By Find Local Law Editorial Team · Last reviewed: May 26, 2026
Researched and drafted with AI assistance and verified against primary sources (statutes, Judicial Council forms, and official court websites). This is general information, not legal advice.
This is general information, not legal advice. Exemption dollar figures change and applying them is fact-specific — talk to a California bankruptcy attorney.
Exemptions decide what property you keep in bankruptcy. California is unusual in how it handles them.
No federal exemptions — and a choice between two state sets
California has opted out of the federal bankruptcy exemptions, so California filers cannot use the federal § 522(d) set (11 U.S.C. § 522). Instead, California gives you a choice between two state systems — and you must pick one, not mix them:
- System 1 — the CCP § 704 series. These exemptions are also used outside bankruptcy (against ordinary creditors) and include a large homestead exemption (CCP § 704.730).
- System 2 — the CCP § 703.140(b) “bankruptcy-only” set. This set is structurally like the federal exemptions and includes a flexible “wildcard” exemption at § 703.140(b)(5).
Which system is better depends on your situation — homeowners with substantial equity often lean toward System 1, while filers with little home equity often prefer System 2’s wildcard.
The System 1 homestead
After AB 1885 (effective Jan 1, 2021), the System 1 homestead under CCP § 704.730 is the greater of $300,000 or the prior-year countywide median sale price of a single-family home, capped at $600,000. These amounts adjust for inflation annually since 2022 (confirm current).
The System 2 wildcard
If you don’t have much home equity, System 2 may protect more. Its wildcard (§ 703.140(b)(5)) can be applied to almost any property, which is useful for filers who rent or have modest assets.
These choices shape what most Chapter 7 filers keep and how much Chapter 13 filers must repay.
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Start your free intakeFrequently asked questions
- Can I use the federal bankruptcy exemptions in California?
- No. California opted out of the federal exemptions, so California filers cannot use the federal § 522(d) set. You must use one of California's two state exemption systems instead.
- Can I mix the two California exemption systems?
- No. California offers a choice between the System 1 (CCP § 704) set and the System 2 (CCP § 703.140) set, and you must pick one system — you cannot combine exemptions from both.
- How big is California's homestead exemption?
- Under the System 1 / CCP § 704.730 homestead (after AB 1885, effective Jan 1, 2021), it's the greater of $300,000 or the prior-year countywide median sale price of a single-family home, capped at $600,000, with annual inflation adjustments since 2022 (confirm current).
Sources
Related guides
- Automatic Stay & Discharge in California Bankruptcy Filing bankruptcy triggers the automatic stay (11 U.S.C. § 362), an immediate halt to most collection — lawsuits, wage garnishment, repossession, and foreclosure. A discharge (11 U.S.C. § 524, § 727) permanently bars collecting discharged debts, but some debts are non-dischargeable (11 U.S.C. § 523), including most recent taxes, student loans, child support, alimony, and fraud debts.
- Chapter 13 Bankruptcy in California Chapter 13 is a repayment plan over 3 years (if you're below California's median income) or up to 5 years (at or above median); no plan exceeds 5 years (11 U.S.C. § 1322(d), § 1325). It lets people with regular income cure a mortgage or car default and keep their property.
- Chapter 7 Bankruptcy in California Chapter 7 is liquidation bankruptcy: a trustee can sell nonexempt property to pay creditors, and the individual debtor receives a discharge of most unsecured debts (11 U.S.C. § 727). It requires passing the means test and completing credit counseling. Most California filers keep their property using California's exemptions.
- The Chapter 7 Means Test in California The Chapter 7 means test (11 U.S.C. § 707(b)) compares your income to the median income for your household size in California. Below median, you generally qualify; above median, a disposable-income calculation may create a presumption of abuse. California's median figures update periodically via the U.S. Trustee.