Bankruptcy exemptions are an important part of the bankruptcy system. In Chapter 7 bankruptcy, exemptions will determine what property you get to keep, such as your home, car, pension, personal belongings, or other property. If the property is exempt, you can keep it during and after bankruptcy while still receiving a bankruptcy discharge. Eliminating Property Taxes. Bankruptcy comes in two major types: Chapter 7 liquidation and Chapter 13 reorganization. Generally, property taxes at least a year old can be eliminated through Chapter 7. Keep in mind: In Missouri, a creditor's ability to collect under a judgment lien will be affected by a number of factors -- including a fixed amount of value that won't be touchable if the property is the debtor's primary residence (called a homestead exemption), other liens that may be in place, and any foreclosure or bankruptcy proceedings.