If a home has a homestead exemption of more than $146,450; won't this exemption still apply if you don't file bankruptcy within 40 months?

Yes. However, a judgment creditor can often force a debtor into involuntary bankruptcy within the 40 months to limit the homestead exemption to $146,450. This would then expose any additional equity. That's why you must take other steps to shelter the exposed equity from this contingency and cannot always rely on homestead protection.