What Is “Exempt Property” in Michigan

When a loved one passes away, families often face the emotional strain of loss alongside the legal challenges of probate. One of the critical considerations during this time is determining which assets are protected for the surviving family members.

In Michigan, “exempt property” ensures that certain essential items remain safeguarded from creditors, allowing spouses and children to retain necessities for daily life. At Bassett Murray Law Group, PLLC, we’ve spent decades guiding Michigan families through probate, helping them understand and protect their rights.

This article explains exempt property, providing clarity during a difficult time.

What Is Exempt Property in Michigan?

Exempt property refers to specific assets that surviving family members can retain, even during probate. The law protects these items to ensure the basic needs of the surviving family. Michigan law outlines several categories of exempt property, helping alleviate some of the financial stress on families.

Household Goods, Furnishings, and Personal Effects

The law protects household goods, furnishings, and personal items up to a certain value, adjusted annually for cost-of-living changes. These include:

• Furniture
• Appliances
• Personal effects like clothing and jewelry

If the value of these items is below the allowable limit, other estate assets may be used to make up the difference. For example, if the family’s total household items fall short of the limit, they may allocate additional estate assets to reach the limit.

Loans or liens on items such as vehicles are factored into their protected value, with the exemption covering the net amount after outstanding debts. These protections are available first to the surviving spouse and, if no spouse exists, to the decedent’s children. The value remains the same and is shared among multiple claimants.

Other Types of Exempt Property

In addition to household goods, Michigan law may protect:

• Tools of the trade needed for the decedent’s profession
• Life insurance proceeds, which are often shielded from creditors

Who Can Claim Exempt Property?

The right to claim exempt property follows a specific order of priority:

1. Surviving Spouse: They have the primary claim.
2. Children: If there is no spouse, children divide the exempt property equally.
3. Other Relatives: In the absence of a spouse or children, other relatives may qualify.

Michigan law ensures that even disinherited children may claim exempt property. However, the total value of exempt property does not increase based on the number of claimants—it is divided among them.

How Is Exempt Property Claimed During Probate?

Claiming exempt property involves several steps:

• Filing a Petition: Beneficiaries must submit a Petition to Set Aside Exempt Property to the probate court.
• Submitting an Inventory: This document lists all estate assets, their values, and any debts.
• Meeting Deadlines: Prompt action is essential to secure exempt property rights.
• Appraisals: Items like jewelry or vehicles may require professional appraisals to determine their value.

Taking these steps proactively can help prevent complications and ensure the family receives what they are entitled to.

Priority of Exempt Property Rights

Michigan law specifies the order in which estate assets are distributed:

1. Administration costs, such as court and attorney fees
2. Funeral and burial expenses
3. Homestead allowance
4. Family allowance for temporary financial support
5. Exempt property for eligible beneficiaries
6. Remaining assets used to settle debts

Exempt property is protected from being used to cover court and attorney fees, preserving it for the surviving family’s benefit.

These rights apply whether the decedent had a will or not. Even a surviving spouse electing to take their statutory share of the estate retains the right to claim exempt property, ensuring they receive both their elective share and these essential protections.

Protect Your Rights to Exempt Property in Michigan 

Exploring exempt property laws can provide much-needed peace of mind during probate. At Bassett Murray Law Group, PLLC, we’re committed to guiding Michigan families through these challenging times with compassion and expertise.

If you’re facing probate and need help claiming exempt property, call us today. Reach us at 734-930-9200 in Ann Arbor or 231-427-2292 in Petoskey. Let’s work together to protect what matters most.