Exemptions protect your assets in bankruptcy. When you file bankruptcy you have to list all of your assets, you then will also list an exemption to protect the asset from the bankruptcy estate, if one is available to you. In Minnesota you can pick between federal and state exemptions, this is not the case for every state though. Your attorney will help you go through your assets and which exemptions to apply.
Each set of exemptions, either federal or Minnesota, have general exemptions for certain items and then a wild card exemption, which can be used on anything.
If you have exempted your property and there has been no objection to the exemptions 30 days after your concluded 341 hearing, the property reverts back to you and is not property of the bankruptcy estate any longer. After the 30 days, the trustee and creditors are barred from objecting to the exemptions.
In a chapter 7 case, if you have non-exempt assets you will need to either pay the value of the non-exempt portion to the bankruptcy estate or liquidate the assets. In a chapter 13 case you do not liquidate your non-exempt assets, but the value is factored into what you pay your creditors overall.
If you have lived in more than one state in the 730 days prior to filing, you will have to look at the state in which you lived the most of the time during the 180 days prior to the 730 days before filing. That state will determine which set of exemptions you can use.
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