Bankruptcy in Maryland - Maryland exemptions




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Maryland Bankruptcy Exemptions

The Maryland bankruptcy exemptions chart, see below, details the property you can exempt or protect from creditors when you file bankruptcy in Maryland. You may exempt any property that falls into one of the exemptions categories below, up to the dollar amount listed. You will be able to kept this exempted property after you file bankruptcy. Please note that there are certain debts which you will not be able to erase in bankruptcy. (see Non-dischargeable Debts)

An exemption limit applies to any equity you have in the property. Equity is the difference between the value of the property and what is owed on the property. For example, a car valued at $5000 with a loan of $4500 has an equity value of only $500.

If the property is secured by a loan, such as a car or home, and you are current on the payments, the equity is covered by your exemptions, and you elect to keep making payments on the loan you generally can keep this property through the bankruptcy. If all the equity is not covered by your exemptions the trustee may elect to liquidate this asset and distribute the assets. Generally, in this case, you would be entitled to the value of your exemption in the asset as a cash payment.

Bankruptcy law allows married couples filing jointly to each claim a full set of exemptions, unless otherwise noted.

To keep non-exempt property, a debtor must generally pay the trustee the value of the non-exempt property.

When you file bankruptcy in Maryland you may also use certain federal exemptions in addition to your Maryland exemptions.

ASSET

EXEMPTION DESCRIPTION

LAW SECTION

HOMESTEAD

NONE, however, property held as tenancy by the entirety may be exempt against debts owed by only one spouse

In re Sefren

41 B.R. 747 (D. Md. 1984)

INSURANCE

Disability or health benefits, including court awards, arbitrations and settlements

Courts and Jud. Proceedings 11-504(b)(2)

Fraternal benefit society benefits

Ins. 8-431; Estates & Trusts 8-115

Life insurance or annuity contract proceeds or avails if beneficiary is insured?s dependent, child or spouse

Ins. 16-111(a), Estates & Trusts 8-115

Medical benefits deducted from wages

Commercial 15-601.1

MISC.

Property of business partnership

Corporation 9-502

PENSIONS

Deceased Baltimore police officers (only benefits building up)

73B-49

ERISA-qualified benefits, except IRAs

Courts & Jud. Proceedings 11-504(b)

State employees

Pers. & Pens. 21-502

State police

88B-31

PERSONAL PROPERTY

Appliances, furnishings, household goods, books, pets and clothing to $1,000 total

Courts & Jud. Proceedings 11-504(b)(4)

Burial plots and crypts

5-503

Health aids

Courts & Jud. Proceedings 11-504(b)(3)

Lost future earnings recoveries

Courts & Jud. Proceedings 11-504(b)(2)

PUBLIC BENEFITS

AFDC, general assistance

88A-73

Crime victims? compensation

Proc. 11-816

Unemployment compensation

Lab. & Empl. 8-106

Workers? compensation

Lab. & Empl. 9-732

TOOLS OF TRADE

Clothing, books, tools, instruments and appliances to $5,000; can?t include car (In re Chapman, 68 B>R> 745 (D. Md. 1986)

Courts & Jud. Proceedings 11-504(b)(1)

WAGES

Earned but unpaid wages, the greater of 75% or $415 per week; in Kent, Caroline and Queen Anne?s of Worcester Counties, the greater of 75% of actual wages or 30% of federal minimum wage

Commercial

15-601.1

WILD CARD

$6,000 of cash or property of any kind and $5,000 of real or personal property

Courts 7 Jud. Proceedings 11-504(b)(5), (f)

For more information on filing bankruptcy in Maryland explore Maryland Bankruptcy Law.

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