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Minnesota Legislature

Office of the Revisor of Statutes

Chapter 550

Section 550.37

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550.37 PROPERTY EXEMPT.
    Subdivision 1. Exemption. The property mentioned in this section is not liable to attachment,
garnishment, or sale on any final process, issued from any court.
    Subd. 2. Bible and musical instrument. The family Bible, library, and musical instruments.
    Subd. 3. Pew and burial lot. A seat or pew in any house or place of public worship and
a lot in any burial ground.
    Subd. 4. Personal goods. (a) All wearing apparel, one watch, utensils, and foodstuffs of
the debtor and the debtor's family.
(b) Household furniture, household appliances, phonographs, radio and television receivers
of the debtor and the debtor's family, not exceeding $4,500 in value.
(c) The debtor's aggregate interest, not exceeding $1,225 in value, in wedding rings or other
religious or culturally recognized symbols of marriage exchanged between the debtor and spouse
at the time of the marriage and in the debtor's possession.
The exemption provided by this subdivision may not be waived except with regard to
purchase money security interests. Except for a pawnbroker's possessory lien, a nonpurchase
money security interest in the property exempt under this subdivision is void.
If a debtor has property of the type which would qualify for the exemption under clause (b),
of a value in excess of $4,500 an itemized list of the exempt property, together with the value
of each item listed, shall be attached to the security agreement at the time a security interest is
taken, and a creditor may take a nonpurchase money security interest in the excess over $4,500 by
requiring the debtor to select the exemption in writing at the time the loan is made.
    Subd. 4a. Adjustment of dollar amounts. (a) Except for subdivisions 5 and 7, the dollar
amounts in this section shall change periodically as provided in this subdivision to the extent of
changes in the implicit price deflator for the gross national product, 1972 = 100, compiled by the
United States Department of Commerce, and hereafter referred to as the index. The index for
December 1980 is the reference base index.
(b) The designated dollar amounts shall change on July 1 of each even-numbered year if
the percentage of change, calculated to the nearest whole percentage point, between the index
for December of the preceding year and the reference base index is ten percent or more. The
portion of the percentage change in the index in excess of a multiple of ten percent shall be
disregarded and the dollar amounts shall change only in multiples of ten percent of the amounts
stated in this section.
(c) If the index is revised, the percentage of change pursuant to this section shall be
calculated on the basis of the revised index. If a revision of the index changes the reference
base index, a revised reference base index shall be determined by multiplying the reference
base index then applicable by the rebasing factor furnished by the Department of Commerce.
If the index is superseded, the index referred to in this section is the one represented by the
Department of Commerce as reflecting most accurately changes in the purchasing power of
the dollar for consumers.
(d) The commissioner of commerce shall announce and publish:
(1) on or before April 30 of each year in which dollar amounts are to change, the changes in
dollar amounts required by paragraph (b); and
(2) promptly after the changes occur, changes in the index required by paragraph (c)
including, if applicable, the numerical equivalent of the reference base index under a revised
reference base index and the designation or title of any index superseding the index.
(e) A person does not violate this chapter with respect to a transaction otherwise complying
with this chapter if the person relies on dollar amounts either determined according to paragraph
(b) or appearing in the last publication of the commissioner announcing the then current dollar
amounts.
    Subd. 5. Farm machines. Farm machines and implements used in farming operations by a
debtor engaged principally in farming, livestock, farm produce, and standing crops, not exceeding
$13,000 in value. When a debtor is a partnership of spouses or a partnership of natural persons
related to each other within the third degree of kindred according to the rules of the civil law, for
the purposes of the exemption in this subdivision, the partners may elect to treat the assets of the
partnership as assets of the individual partners.
    Subd. 6. Tools of trade. The tools, implements, machines, instruments, office furniture, stock
in trade, and library reasonably necessary in the trade, business, or profession of the debtor, not
exceeding $5,000 in value.
    Subd. 7. Value limitations. The total value of property selected by a debtor pursuant to
subdivisions 5 and 6 shall not exceed $13,000, if the exemptions under subdivisions 5 and 6
are combined.
    Subd. 8. University apparatus. The library and philosophical and chemical or other
apparatus belonging to, and used for the instruction of youth in, any university, college, seminary
of learning, or school which is indiscriminately open to the public.
    Subd. 9. Exempt property claims. All money arising from any claim on account of the
destruction of, or damage to, exempt property.
    Subd. 10. Insurance proceeds. All money received by, or payable to, a surviving spouse
or child from insurance payable at the death of a spouse, or parent, not exceeding $20,000. The
$20,000 exemption provided by this subdivision shall be increased by $5,000 for each dependent
of the surviving spouse or child.
    Subd. 11. Beneficiary associations. All money, relief, or other benefits payable or to
be rendered by any police department association, fire department association, beneficiary
association, or fraternal benefit association to any person entitled to assistance therefrom, or to
any certificate holder thereof or beneficiary under any such certificate.
    Subd. 12. Manufactured home. A manufactured home, as defined in section 168.011,
subdivision 8
, which is actually inhabited as a home by the debtor.
    Subd. 12a. Motor vehicles. One motor vehicle to the extent of a value not exceeding $2,000;
or one motor vehicle to the extent of a value not exceeding $20,000 that has been modified, at a
cost of not less than $1,500, to accommodate the physical disability making a disabled person
eligible for a certificate authorized by section 169.345.
    Subd. 13. Earnings. All earnings not subject to garnishment by the provisions of section
571.922. A subsequent attachment, garnishment, or levy of execution shall impound only that pay
period's nonexempt disposable earnings not subject to a prior attachment, garnishment or levy of
execution, but in no instance shall more than an individual's total nonexempt disposable earnings
in that pay period be subject to attachment, garnishment, or levy of execution. Garnishments shall
impound the nonexempt disposable earnings in the order of their service upon the employer. The
disposable earnings exempt from garnishment are exempt as a matter of right, whether claimed
or not by the person to whom due. The exemptions may not be waived. The exempt disposable
earnings are payable by the employer when due. The exempt disposable earnings shall also be
exempt for 20 days after deposit in any financial institution, whether in a single or joint account.
This 20-day exemption also applies to any contractual setoff or security interest asserted by a
financial institution in which the earnings are deposited by the individual. In tracing the funds, the
first-in first-out method of accounting shall be used. The burden of establishing that funds are
exempt rests upon the debtor. As used in this section, the term "financial institution" includes credit
unions. Nothing in this paragraph shall void or supersede any valid assignment of earnings or
transfer of funds held on account made prior to the attachment, garnishment, or levy of execution.
    Subd. 14. Public assistance. All relief based on need, and the earnings or salary of a person
who is a recipient of relief based on need, shall be exempt from all claims of creditors including
any contractual setoff or security interest asserted by a financial institution. For the purposes of
this chapter, relief based on need includes MFIP, work first, general assistance medical care,
supplemental security income, medical assistance, Minnesota supplemental assistance, and
general assistance. The salary or earnings of any debtor who is or has been an eligible recipient of
relief based on need, or an inmate of a correctional institution shall, upon the debtor's return to
private employment or farming after having been an eligible recipient of relief based on need,
or an inmate of a correctional institution, be exempt from attachment, garnishment, or levy of
execution for a period of six months after the debtor's return to employment or farming and after
all public assistance for which eligibility existed has been terminated. The exemption provisions
contained in this subdivision also apply for 60 days after deposit in any financial institution,
whether in a single or joint account. In tracing the funds, the first-in first-out method of accounting
shall be used. The burden of establishing that funds are exempt rests upon the debtor. Agencies
distributing relief and the correctional institutions shall, at the request of creditors, inform them
whether or not any debtor has been an eligible recipient of relief based on need, or an inmate of a
correctional institution, within the preceding six months.
    Subd. 15. Minor child earnings. The earnings of the minor child of any debtor and any
child support paid to any debtor, or the proceeds thereof, by reason of any liability of such debtor
not contracted for the special benefit of such minor child.
    Subd. 16. Claims for damages. The claim for damages recoverable by any person by
reason of a levy upon or sale under execution of the person's exempt personal property, or by
reason of the wrongful taking or detention of such property by any person, and any judgment
recovered for such damages.
    Subd. 17. Selection. All articles exempted by this section shall be selected by the debtor, the
debtor's agent, or legal representative.
    Subd. 18. Natural persons limitation. The exemptions provided for in subdivisions 3
to 15 extend only to debtors who are natural persons except as provided in subdivision 5 for
partnerships.
    Subd. 19. Waiver. The exemption of the property listed in subdivisions 2, 3, and 5 to 12a
may not be waived except by a statement in substantially the following form, in boldface type
of a minimum size of 12 points, signed and dated by the debtor at the time of the execution of
the contract surrendering the exemption, immediately adjacent to the listing of the property: "I
understand that some or all of the above property is normally protected by law from the claims of
creditors, and I voluntarily give up my right to that protection for the above listed property with
respect to claims arising out of this contract."
    Subd. 20. Traceable funds. The exemption of funds from creditors' claims, provided by
subdivisions 9, 10, 11, 15, and 24, shall not be affected by the subsequent deposit of the funds
in a bank or any other financial institution, whether in a single or joint account, if the funds are
traceable to their exempt source. In tracing the funds, the first-in first-out method of accounting
shall be used. The burden of establishing that funds are exempt rests upon the debtor. No bank or
other financial institution shall be liable for damages for complying with process duly issued out
of any court for the collection of a debt even if the funds affected by the process are subsequently
determined to have been exempt.
    Subd. 21. Value. For the purpose of this section, "value" means current fair market value.
    Subd. 22. Rights of action. Rights of action for injuries to the person of the debtor or of
a relative whether or not resulting in death.
    Subd. 23. Life insurance aggregate interest. The debtor's aggregate interest not to exceed
in value $4,000 in any accrued dividend or interest under or loan value of any unmatured life
insurance contract owned by the debtor under which the insured is the debtor or an individual
of whom the debtor is a dependent.
    Subd. 24. Employee benefits. (a) The debtor's right to receive present or future payments, or
payments received by the debtor, under a stock bonus, pension, profit sharing, annuity, individual
retirement account, Roth IRA, individual retirement annuity, simplified employee pension, or
similar plan or contract on account of illness, disability, death, age, or length of service, to the
extent of the debtor's aggregate interest under all plans and contracts up to a present value
of $30,000 and additional amounts under all the plans and contracts to the extent reasonably
necessary for the support of the debtor and any spouse or dependent of the debtor.
(b) The exemptions in paragraph (a) do not apply when the debt is owed under a support
order as defined in section 518A.26, subdivision 21.
    Subd. 25. Proceeds for improvements to property. Proceeds of payments received by a
person for labor, skill, material, or machinery contributing to an improvement to real estate
within the meaning of section 514.01.
History: (9447) RL s 4317; 1909 c 12 s 1; 1913 c 375 s 1; 1915 c 202 s 1; 1923 c 154 s 1;
1923 c 350 s 1; 1927 c 272; 1933 c 350 s 1; 1939 c 263; 1941 c 351; 1949 c 282 s 1; 1951 c 673 s
1; 1955 c 859 s 1; 1961 c 568 s 1; 1967 c 835 s 1; 1969 c 1142 s 23,24; 1976 c 335 s 6-10; 1977 c
180 s 3; 1980 c 550 s 1-4; 1980 c 599 s 6-8; 1981 c 7 s 1; 1981 c 322 s 1; 1981 c 365 s 9; 1983 c
235 s 5-11; 1983 c 289 s 114 subd 1; 1984 c 655 art 1 s 92; 1985 c 306 s 2-6; 1Sp1985 c 1 s 24;
1986 c 444; 1988 c 490 s 2-4; 1989 c 284 s 1; 1989 c 350 art 16 s 2-4; 1991 c 199 art 2 s 1; 1993
c 79 s 7; 1993 c 156 s 6; 1995 c 207 art 2 s 36; 1997 c 85 art 4 s 37; 1997 c 203 art 6 s 84; 1999 c
159 s 143; 1999 c 160 s 1; 2000 c 430 s 3; 2005 c 137 s 1; 2005 c 164 s 29; 1Sp2005 c 7 s 28