Maryland Bankruptcy Exemptions

Learn what property you can keep in bankruptcy with Maryland's bankruptcy exemptions.

January 26, 2017

If you file for  Chapter 7 bankruptcy  in Maryland, you can use Maryland’s bankruptcy exemption law to protect your property. Bankruptcy exemptions also play a role in determining how much you'll pay in a  Chapter 13 case. Continue reading to learn about the property you can protect with Maryland’s bankruptcy exemptions.

The Bankruptcy Exemptions in Maryland

Exemptions are specific laws that allow you to protect certain property, such as your car or home, from your creditors. Some states allow residents to choose between the state exemptions or the  federal exemptions; however, because Maryland has opted out of the federal system, you'll be limited to the Maryland exemptions. You can supplement the state set with  federal non-bankruptcy exemptions  to protect property such as federal and military retirement funds and veteran’s benefits.

Commonly Used Maryland Bankruptcy Exemptions

Below is a list of commonly used Maryland bankruptcy exemptions. Unless otherwise indicated, all references are to the Code of Maryland (Md. Code Ann.).

Homestead

Up to $23,675 of equity  in any owner-occupied real estate (house, condominium, co-op, or permanently affixed manufactured home. Married couples cannot double the Maryland homestead exemption. (Cts. & Jud. Proc. § 11-504(f)(1)(i)(2), Real Prop § 8-203(d)(3)(ii))

Personal Property

Up to $5,000 in tools of your trade, including clothing, books, tools, and inventory. (Cts. & Jud. Proc. § 11-504(b)(4))

Professionally prescribed health aids. (Cts. & Jud. Proc. § 11-504(b)(3))

Up to $1,000 in appliances and furnishings, clothing, pets, and books for use by you or your dependents. (Cts. & Jud. Proc. § 11-504(b)(4))

Burial plot. (Bus. Reg. § 5-503)

Maryland doesn't have a motor vehicle exemption, but you can use your wildcard exemptions to protect equity in your vehicle.

Public Benefits, Earnings & Support

Court-ordered child support payments. (Cts. & Jud. Proc. § 11-504(b)(6))

75% of disposable earnings or $145 per week, whichever is greater (plus medical payments deducted by an employer), or, for residents of  Caroline, Kent, Queen Anne’s and Worcester counties, 75% of disposable earnings or 30 times the federal minimum wage, whichever is greater (plus medical payments deducted by an employer). (Com. Law   § 15-601.1)

Alimony in an amount equal to your earnings exemption. (Cts. & Jud. Proc. § 11-504(b)(7), Com. Law   § 15-601.1)  

Public assistance benefits.  (Human Serv. § 5-407(a)(1), (2))

Retirement Benefits

ERISA-qualified benefits and IRAs.  (Cts. & Jud. Proc. § 11-504(h))

State employees retirement accounts and benefits.  (State Pers. & Pens. § 21-502)

Wildcard Exemptions

Cash or property up to $6,000 in value, plus an additional $5,000 of value in personal property.  (Cts. & Jud. Proc. § § 11-504(b)(5),  (f)(1)(i)(1))

(To learn more, see  The Maryland Wildcard Exemption.)

Insurance and Damages

Disability or health benefits, including court awards, arbitration awards, & settlements.  (Cts. & Jud. Proc. § 11-504(b)(2))

Fraternal benefit society benefits.  (Ins. § 8-431, Est. & Trusts § 8-115)

Life insurance or annuity contract proceeds when the  beneficiary is the insured's dependent, child, or spouse.  (Ins. § 816-111(a))

Personal Injury, Wrongful Death, Lost Future Earnings Awards

Settlements or awards that you receive as the result of any person's injury or illness or wrongful death; lawsuit or settlement awards for lost future earnings. (Cts. & Jud. Proc. § 11-504(b)(2))

Confirming the Maryland Bankruptcy Exemptions

This list includes some of the more common Maryland bankruptcy exemptions, but others exist. You can verify the current exemption amounts at the website of the  Maryland General Assembly.

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