Exemptions are those things that the federal and/or state government allows you to keep.  Every governing body understands that we need certain items to sustain ourselves and maintain a certain standard of living.  How exemptions vary is a bit complicated.  Some states allow debtors to choose from the federal exemptions (most of which are found in the United States Code and the United States Code Annotated) and the state’s exemptions.

Every bankruptcy filer is allowed to keep a certain amount of clothing, cash, jewelry and/or other household items. Many retirement accounts are exempt as is a certain amount of equity in homes and cars.