In many areas exempt property is property that can neither be passed by will nor claimed by creditors of the deceased in the event that a decedent leaves a surviving spouse or surviving descendants. Normally, exempt property includes a family car, and a certain amount of cash, or the equivalent value in personal property.

In a Chapter 7 bankruptcy case, the defaulter has to turn certain property over to the bankruptcy trustee, so that the property can be sold and the proceeds used to pay off debts.

Debtors, whether they are businesses or individuals, are often reasonably concerned about what property they will be allowed to keep and what they must give up. Some exempt items that a nonpayer may usually keep can include: Motor vehicles, up to a certain value, reasonably necessary household possessions and furnishings, household appliances, pensions, fraction of equity in the debtor's home, tools of the debtor's trade or profession, up to a certain value, portion of unpaid but earned wages, public benefits, including public assistance, social security, and unemployment payment, accumulated in a bank account, etc.