Do Florida Exemptions Protect Assets in Other States?

Florida exemptions do not follow a Florida resident into another state’s courts. The court where the creditor collects decides which exemptions apply. An out-of-state house, bank account, or paycheck reached through another state’s court falls under that state’s exemption law. Where the judgment was entered does not control. A creditor who brings one to Florida to reach Florida assets collects under Florida’s exemptions.

Florida’s exemptions are among the most generous in the country. Florida offers an unlimited homestead exemption, unlimited retirement account protection, full wage protection for heads of household, and tenancy by the entireties coverage for all personal property. A Florida resident whose assets are reached through another state’s court may find that none of these protections apply.

Does the Forum State or the Debtor’s Home State Control Exemptions?

Most courts apply the exemption law of the forum state, the state where the collection action takes place. The Restatement (Second) of Conflict of Laws supports this approach. When a creditor obtains a judgment in New York and initiates garnishment in New York, the New York court applies New York exemption law to determine what the creditor can reach.

A Florida resident who qualifies as head of household cannot use that exemption in a state whose garnishment law has no equivalent. If the employer has offices in both Florida and another state, a creditor may serve the garnishment writ on the employer’s out-of-state office. The debtor’s wages then fall under that state’s garnishment rules. The Florida debtor would need to hire counsel in that state and persuade its judge to apply Florida law, an argument that rarely succeeds.

The forum state rule also applies to bank accounts, retirement accounts, and other financial assets held outside Florida. A creditor who obtains a garnishment order in the state where the account is maintained can reach those assets under that state’s exemption rules, even if Florida would fully protect the same account type.

When Does a Court Apply Another State’s Exemption Law Instead?

A court applies another state’s exemption law when that state, rather than the forum, has the dominant interest in the exemption question. Under the Restatement (Second) of Conflict of Laws, that interest turns on connections such as where the debtor and the creditor live.

A bank garnished a Florida resident’s Fidelity brokerage accounts through a federal court in Texas. Bank of America v. National Financial Services, 2016 WL 11735382 (W.D. Tex. Oct. 18, 2016). Texas law would have exposed the whole account. The court held that Florida law governed instead. Both sides were tied to Florida. The debtor lived there and signed the accounts in Jacksonville, and the bank kept offices in the state.

Florida law still cost him half. The account application had a box for tenants by the entirety. He checked a different box: joint tenants with rights of survivorship. The court found the accounts were not entireties property and let the bank garnish his one-half share.

The dominant interest exception is not automatic. The debtor must raise the argument and demonstrate why the state where the debtor resides has a stronger connection than the forum state, counting the creditor’s ties as well as the debtor’s. Where the asset sits is a separate question. That decides which court can reach the asset at all.

Where Is an Asset Legally “Located”?

The legal situs of an asset determines which state’s exemption law applies. Real property is located in the state where it sits. A Florida resident’s vacation home in Colorado is subject to Colorado’s exemption and collection laws. The Florida homestead exemption protects only the debtor’s primary residence in Florida.

Financial accounts are harder to place. A Florida court can garnish an account held in Florida but not an account held in another state, because garnishment runs against the asset itself. The Fourth District held in Navy Federal Credit Union v. Veros Credit (2024) that where the bank answers that the accounts are outside Florida and the creditor disputes it, the court must try that question before entering judgment. An account is not located everywhere its bank has a branch. Deposit slips and account-opening records are the evidence courts weigh.

Retirement accounts held with an out-of-state custodian raise the same location question. Florida’s exemption for retirement accounts applies when the collection happens in a Florida court. If the creditor reaches the custodian in its home state, that state’s exemption rules govern.

Are Wages Earned Outside Florida Protected?

Florida’s head of household exemption covers wages earned outside Florida whenever the garnishment runs through a Florida court. Nothing in the exemption turns on where the debtor lives or where the work is done. The Legislature deleted the phrase “residing in this state” from the wage statute in 1993. A debtor living in South Carolina for seven years kept the exemption against a Florida writ of garnishment. A creditor who serves the writ on the employer in the state where the work is performed gets that state’s rules instead.

That state’s court applies its own garnishment formula. Federal law protects the same minimum everywhere. A creditor may take no more than 25% of disposable earnings, and may not reach the first thirty times the federal minimum hourly wage in a week. In a state without a head-of-family exemption, the rest is reachable regardless of how many people the debtor supports.

If the work can genuinely be structured so that a Florida entity employs and pays the debtor, there is no out-of-state payroll office for a creditor to serve. A creditor who can reach the employer through another state’s court can still ask that court for a writ.

Do Florida LLC Protections Apply to LLCs Formed Elsewhere?

A Florida resident who forms an LLC in another state risks losing the exemption protection that a Florida LLC would provide. Florida law treats a debtor’s LLC membership interest as personal property located where the debtor resides. Some other states treat the interest as located where the LLC is organized, and those states’ laws will govern collection efforts there.

In Wells Fargo Equipment Finance v. Retterath (Iowa 2019), a married couple living in Florida jointly owned a membership interest in an Iowa LLC. A creditor obtained a judgment against the husband and domesticated it in Iowa. The Retteraths argued that the interest was tenants by the entireties property under Florida law and therefore exempt from the husband’s individual creditor. The Iowa Supreme Court applied Iowa law because the LLC was organized there. Iowa does not recognize tenancy by the entireties, and the charging order against the husband’s membership interest stood.

Organizing the LLC in Florida would have removed the Iowa forum. Entireties protection would still have depended on how the couple took title. There the husband moved units he already owned into joint names, so the spouses never took title from the same conveyance. Forming an LLC in Delaware or Nevada for perceived advantages opens a second forum a creditor can use.

How Does Bankruptcy Affect Which State’s Exemptions Apply?

Bankruptcy ignores the forum rule and looks instead at where the debtor was domiciled. Under 11 U.S.C. § 522(b)(3)(A), the exemptions available come from the state where the debtor’s domicile was located for the 730 days before the petition. Filing in a Florida bankruptcy court does not by itself put Florida’s exemptions on the table.

A debtor whose domicile shifted during those 730 days uses an earlier window, the 180 days that ran immediately before the 730-day period began. The state where the debtor was domiciled then, or for the longer part of that stretch, supplies the exemptions. That window falls two years back, not in the six months before filing. If the rule would leave the debtor with no exemptions at all, the Bankruptcy Code allows the federal list instead.

Clearing the 730 days does not deliver Florida’s homestead exemption at full strength. Section 522(p) caps the homestead equity a debtor acquired during the 1,215 days before filing. The cap is $214,000 for cases filed between April 1, 2025 and March 31, 2028. Rolled-over equity escapes the cap only when the old and new homes sit in the same state, so a buyer arriving from another state gets no such credit.

What Happens to Homestead Proceeds When a Debtor Leaves Florida?

Homestead sale proceeds lose their protection when the seller leaves Florida for good. Florida keeps the proceeds exempt only where the seller intended, before and at the closing, to acquire another homestead within a reasonable time. Only the portion actually meant for reinvestment is exempt, and the money must be kept separate from other funds. Bankruptcy courts have disallowed the exemption where a debtor listed the Florida house, moved belongings and banking to the new state, and registered vehicles there.

If the new state caps its homestead exemption at a dollar figure, the equity above that cap is exposed to creditors once the debtor establishes domicile there. Whether the proceeds are protected before the next home is bought is a question of that state’s law, not Florida’s.

Does Florida’s 529 Plan Exemption Apply to Out-of-State Plans?

Florida’s exemption for college savings plans covers any qualified tuition program under Section 529 of the Internal Revenue Code, not just the Florida Prepaid plan. A Florida resident who holds a Virginia or New York 529 plan is protected exactly as if the account were Florida-sponsored. Florida Statute § 222.22 exempts the money paid into such a plan, the plan’s assets, and its income.

Florida wrote the statute to cover a plan by its federal tax character rather than by which state sponsors it. That is why the protection follows an out-of-state 529 account. A court in another state applies its own exemption list, so Florida’s protection reaches the account only in a Florida proceeding.

How Can Florida Residents Keep Assets Within Florida’s Jurisdiction?

Florida residents protect their exemptions by keeping both the assets and the records that locate them inside Florida. Opening and maintaining accounts at a Florida branch of a Florida institution puts the signature card and the deposit records in the state. Someone who moved to Florida and left a brokerage or retirement account with an out-of-state custodian should expect that custodian’s home state to be a live forum for a creditor.

Holding out-of-state real property through a Florida LLC converts the debtor’s asset from land in another state into a Florida membership interest. The LLC interest is subject to Florida’s exemption and collection rules, including tenants by the entireties protection where a married couple takes the membership interest together in one transfer.

Centralizing employment, banking, and investment relationships within Florida minimizes the risk that a creditor can circumvent Florida’s exemption protections by reaching assets through another state’s court. The fewer connections a debtor maintains to other states, the harder it becomes for a creditor to establish the jurisdiction needed to apply a less favorable exemption law.