December 18, 2017
When money is tight, filing for bankruptcy in Maine can take care of bills that keep piling up. Most people start the process by learning about the differences between filing for Chapter 7 or Chapter 13 bankruptcy. Once you know which type of bankruptcy is best for you—and you’re ready to fill out the paperwork—you’ll need additional information, such as official bankruptcy forms, Maine means test figures, credit counseling courses, and the location of your local bankruptcy court. In this article, you’ll learn where to find these things, as well as how you can protect property in a Maine bankruptcy.
Official Bankruptcy Forms
Before the Maine bankruptcy court eliminates (discharges) your qualifying debt, you must first disclose details about your finances on bankruptcy forms, including property, bills, income, expenses, and financial transactions.
You’ll go to the U.S. Courts form page for free, downloadable forms. Completed paperwork gets filed in bankruptcy court assigned to your area. You’ll also pay a filing fee or file a request for a fee waiver, along with proof you’ve taken a credit counseling course (more below).
Bankruptcy Information for Maine
Federal law governs bankruptcy filings, but you’ll need to know of some aspects of Maine law and procedure for the process, too.
Means Testing and Credit Counseling Information
You can find two types of Maine-specific information on the U.S. Trustee website: means testing figures and approved credit counseling providers.
- Means test figures. When filing a Chapter 7 bankruptcy, you’ll need to ensure that your income is within guidelines and that you pass the “means test.” A total family income exceeding the median income of Maine still might pass after subtracting allowed standard expenses. If you’re lower than the median, you qualify. The income and expense charts are under “Means Testing Information.” In a Chapter 13 bankruptcy, you’ll use a similar calculation to figure your monthly payment amount.
- Class providers. Most filers are required to take two education courses: a credit counseling course before the case begins, followed by a debt management course taken during the case. You’ll find approved providers under “Credit Counseling & Debtor Education” by scrolling down to the District of Maine.
Maine Bankruptcy Court Locations
On the Maine bankruptcy court website, you’ll find the court’s local rules, filing instructions, and where to file your case by clicking on “Filing Without an Attorney.” Here are the locations of the District of Maine’s two divisions:
|U.S. Bankruptcy CourtDistrict of MaineMC Smith Federal Building202 Harlow Street, 3rd FloorBangor, ME 04401(207) 945-0348
||U.S. Bankruptcy CourtDistrict of Maine537 Congress Street, 2nd FloorPortland, ME 04101(207) 780-3482
Maine Bankruptcy Exemptions
You won’t lose everything when you file a Maine bankruptcy case, but you might have to give up assets that don’t appear on the Maine exemptions list or the federal nonbankruptcy exemptions list (you can use both).
Because you won’t be able to protect property that isn’t covered by an exemption, it will get sold in a Chapter 7 case for the benefit of your creditors. By contrast, you can keep nonexempt property in a Chapter 13 bankruptcy if you have enough income to pay for it in the Chapter 13 repayment plan.
Below are some commonly-used Maine bankruptcy exemptions (citations are to the Maine Revised Statutes). Be aware that spouses filing a joint bankruptcy in Maine can double the exemption amount if they both own the property.
- Homestead. Up to $47,500 of equity in any real or personal property used as a residence, including co-ops. Burial plots are subject to the same exemption amount. You can protect up to $95,000 of equity in your home if minor dependents reside with you, or if you or your dependent is 60 years of age or older, or is mentally or physically disabled and unable to maintain gainful employment. (Me. Rev. Stat. Ann. tit. 14, § 4422(1))
- Personal property. Up to $5,000 in one motor vehicle (Me. Rev. Stat. Ann. tit. 14, § 4422(2)); up to $200 per item in household goods and furnishings, clothing, appliances, books, animals, crops, and musical instruments (Me. Rev. Stat. Ann. tit. 14, § 4422(3)); up to $750 worth of jewelry for personal or family use (Me. Rev. Stat. Ann. tit. 14, § 4422(4)); one cooking stove, furnaces and stoves used for heating, and up to ten cords of wood, five tons of coal, and 1,000 gallons of petroleum for personal or family use (Me. Rev. Stat. Ann. tit. 14, § 4422(6)); up to $5,000 in tools needed in a trade, including books, tools, and inventory (Me. Rev. Stat. Ann. tit. 14, § 4422(5)); up to 6 months worth of food, seed, feed, and materials for raising food (Me. Rev. Stat. Ann. tit. 14, § 4422(7)); one of each type of farm equipment reasonably necessary to raise and harvest commercial agricultural products (Me. Rev. Stat. Ann. tit. 14, § 4422(8)); one boat, up to five tons burden, used primarily for commercial fishing, and one of each type of professional logging equipment necessary to harvest and haul wood commercially (Me. Rev. Stat. Ann. tit. 14, §§ 4422(9) & (9A)); professionally prescribed health aids for you or your dependents (Me. Rev. Stat. Ann. tit. 14, § 4422(12)).
- Insurance and damages. Any unmatured life insurance contract (Me. Rev. Stat. Ann. tit. 14, § 4422(10)); up to $4,000 in dividend or loan value of an unmatured life insurance contract, for which you or your dependent is the insured (Me. Rev. Stat. Ann. tit. 14, § 4422(11)); crime victim’s reparation awards, life insurance proceeds or awards for the wrongful death of a person upon whom you were dependent, loss of future earnings awards and up to $12,500 in personal injury damages for you or a person upon whom you are dependent (Me. Rev. Stat. Ann. tit. 14, § 4422(14)).
- Public benefits and support. Social Security, unemployment compensation, veteran’s, disability, and public assistance benefits, including the federal earned income and additional child tax credits; alimony and support, reasonably necessary for the support of you and your dependents (Me. Rev. Stat. Ann. tit. 14, § 4422(13), tit. 39, § A-106).
- Retirement benefits. ERISA-qualified benefits needed for support: payments or accounts under a stock bonus, profit sharing, pension, annuity, or similar plan on account of illness, disability, death, age or length of service, to the extent reasonably necessary for the support of you and your dependents (Me. Rev. Stat. Ann. tit. 14, § 4422(13)); state employees' retirement accounts and benefits (Me. Rev. Stat. Ann. tit. 5, § 17054). (Additional exemptions might also be available for retirement benefits. See Your Retirement Plan in Bankruptcy.)
- Wildcard. Up to $400 in any property (Me. Rev. Stat. Ann. tit. 14, § 4422(15)); up to $6,000 of unused homestead exemption value can be used to protect the following types of property only: animals, crops, musical instruments, books, clothing, furnishings, household goods, appliances, jewelry, tools of the trade, and personal injury recoveries (Me. Rev. Stat. Ann. tit. 14, § 4422(16)).
Maine adjusts these amounts periodically, and other exemptions exist. You’ll want to verify that you’re protecting your property fully by checking the Maine statutes on the website for the Maine Legislature or by consulting with a bankruptcy attorney.
These resources can help a filer understand some bankruptcy requirements, but not all. For a more detailed review, consider purchasing a self-help book such as How to File for Chapter 7 Bankruptcy by Attorney Cara O’Neill and Albin Renauer J.D.