Maryland
Bankruptcy in Maryland (2026): Exemptions & Means Test
Independently fact-checked against primary sources (last audited August 16, 2026). · Reviewed by the RecordingLaw editorial team. · Law checked current as of August 16, 2026. · 4 primary sources cited on this page. How we verify our legal content
Maryland is a state where the property rules in bankruptcy come almost entirely from state law. Maryland has opted out of the federal bankruptcy exemptions, so filers must use Maryland's own exemptions in the Courts and Judicial Proceedings Article, section 11-504. For decades Maryland was unusual in offering no homestead exemption at all, but it now has a modest homestead plus a flexible $6,000 wildcard. The figures below are current as of mid-2026, and you should confirm the latest amounts before relying on them.
This page is general legal information, not legal advice. It is part of our Bankruptcy by State series.
Does Maryland use state or federal bankruptcy exemptions?
Maryland uses its own exemptions. Md. Code, Courts and Judicial Proceedings 11-504(g) states plainly that in any bankruptcy proceeding a debtor is not entitled to the federal exemptions in 11 U.S.C. 522(d). That makes Maryland an opt-out state, like roughly two-thirds of the country. Maryland filers cannot mix and match; they use the Maryland list.
Tax-qualified retirement accounts remain protected. Section 11-504(h) exempts money in plans qualified under Internal Revenue Code sections such as 401(a), 403(b), 408, and 408A, which covers most 401(k) and IRA balances. Federal nonbankruptcy exemptions, such as Social Security, also continue to apply.
Maryland homestead exemption
Maryland's homestead is the part of this cluster that surprises people. For most of its history Maryland had no homestead exemption, and a filer protected home equity only through the general $6,000 wildcard. The state later added a homestead that exists only in bankruptcy. Under 11-504(f), an individual debtor domiciled in Maryland may exempt owner-occupied residential real property, a condominium, a manufactured home converted to real property, or a cooperative interest, up to the amount in 11 U.S.C. 522(d)(1), adjusted under 11 U.S.C. 104.
Because the cap tracks the federal homestead figure, it is $31,575 for cases filed on or after April 1, 2025, and it is scheduled to adjust again on April 1, 2028. Two limits apply: the homestead cannot be claimed by both a husband and wife in the same bankruptcy, and it cannot be claimed if the same person, or a close relative, successfully claimed it on that property within the prior eight years. Confirm the current figure before filing, since the federal amount it tracks moves on a three-year cycle.
Wildcard, vehicle, and personal-property exemptions
Maryland leans heavily on a flexible wildcard rather than a long list of category-specific exemptions:
- Wildcard: up to $6,000 of cash or property of any kind under 11-504(b)(6), claimed within 30 days of an attachment or levy. This is the workhorse exemption and is commonly used to protect vehicle equity.
- Deposit accounts: up to $500 in a deposit account held at a bank, credit union, or similar institution is exempt automatically under 11-504(b)(5), with no election by the debtor. It does not stack on top of the wildcard: item (b)(6) caps the cumulative value exempted under items (5) and (6) together at $6,000.
- Additional personal property in bankruptcy: up to $5,000 under 11-504(f)(1)(i)1, available specifically in bankruptcy cases on top of the other exemptions.
- Household furnishings, goods, clothing, books, and pets: up to $1,000 under 11-504(b)(4).
- Tools of the trade, including apparel, books, and instruments necessary for a trade or profession: up to $5,000 under 11-504(b)(1).
- Health aids: professionally prescribed health aids are fully exempt under 11-504(b)(3).
- Retirement accounts: tax-qualified plans are exempt under 11-504(h).
Notably, Maryland has no separate motor-vehicle exemption. Filers protect a car by applying the $6,000 wildcard, and sometimes the additional $5,000 personal-property allowance in bankruptcy, to the vehicle's equity. Section 11-504 itself contains no wage exemption, and subsection (e) states that the exemptions in that section do not apply to wage attachments. Earned but unpaid wages are protected by a different statute: Md. Code, Commercial Law 15-601.1(b) exempts from attachment the greater of 75 percent of disposable wages due or 30 times the State minimum hourly wage in effect when the wages are due, multiplied by the number of weeks in which those wages were earned. A Maryland filer reaches that protection in bankruptcy through 11 U.S.C. 522(b)(3)(A), which imports state-law exemptions generally rather than only exemptions written for bankruptcy.
The Chapter 7 means test in Maryland
The means test screens Chapter 7 filings for a presumption of abuse. It first compares your household's current monthly income, annualized, against the median family income for a Maryland household of the same size. If your income is at or below the Maryland median, there is no presumption of abuse and you do not need to complete Form 122A-2, but that alone does not make you eligible for Chapter 7. If it is above, you complete the longer calculation that deducts allowed living expenses to determine whether you have disposable income that should fund a Chapter 13 plan.
The U.S. Trustee Program publishes the median figures. For cases filed on or after April 1, 2026, the Maryland median family income is:
| Household size | Maryland median annual income |
|---|---|
| 1 | $86,928 |
| 2 | $114,611 |
| 3 | $135,949 |
| 4 | $166,173 |
Add $11,100 for each additional person beyond four. These figures were published February 12, 2026 and apply only to cases filed on or after April 1, 2026. The U.S. Trustee Program revises them about twice a year, so confirm the figures for your filing date.
Chapter 7 vs. Chapter 13 in Maryland
Chapter 7 is a liquidation in which a trustee may sell non-exempt property to pay creditors. Because Maryland's exemptions are relatively modest, a filer with significant home equity or a paid-off vehicle should think carefully about what the wildcard and homestead can actually cover. Most remaining unsecured debt, like credit cards and medical bills, is discharged within a few months.
Chapter 13 is a reorganization for people with regular income. You keep your property and repay part or all of your debt over three to five years. It is often used by homeowners who are behind on a mortgage, since the plan can cure the arrears over time and stop a foreclosure.
In both chapters, filing triggers the automatic stay under 11 U.S.C. 362, which immediately stops most collection activity, including foreclosure, wage garnishment, repossession, and collection calls.
Where you file bankruptcy in Maryland
Maryland bankruptcy cases are filed in the U.S. Bankruptcy Court for the District of Maryland, the single federal bankruptcy district covering the whole state. The court sits in Baltimore and Greenbelt. Federal law requires approved credit counseling before you file and a debtor-education course before your debts are discharged.
What bankruptcy can and cannot do
Bankruptcy discharges most unsecured debts, but several categories generally survive: most student loans (absent a separate showing of undue hardship), recent income taxes, child support and alimony, and debts from fraud or willful injury. Secured debts like a mortgage or car loan continue if you keep the collateral and keep paying.
Because Maryland's exemptions are limited and the homestead exists only in bankruptcy, the choice between Chapter 7 and Chapter 13 can hinge on small details. Before you file, get a free bankruptcy evaluation from a Maryland lawyer on which chapter protects more of what you own (attorney advertising).
Frequently Asked Questions
Does Maryland use state or federal bankruptcy exemptions?
Maryland uses state exemptions. Under Md. Code, Cts. & Jud. Proc. 11-504(g), a debtor in bankruptcy is not entitled to the federal exemptions in 11 U.S.C. 522(d), so Maryland filers must use the Maryland list, although tax-qualified retirement accounts and federal nonbankruptcy exemptions still apply.
What is the homestead exemption in Maryland?
Maryland's homestead protects up to $31,575 of equity in owner-occupied residential real property. The cap is tied to the federal amount in 11 U.S.C. 522(d)(1) and is set at $31,575 for cases filed on or after April 1, 2025, with the next adjustment due April 1, 2028. It applies only in bankruptcy, cannot be claimed by both a husband and wife in the same bankruptcy proceeding, and cannot be claimed on the same property again within 8 years.
Did Maryland used to have no homestead exemption?
Yes. For most of its history Maryland had no homestead exemption, and filers protected home equity only with the general wildcard. Maryland later added a homestead that exists only in bankruptcy and is tied to the federal 522(d)(1) figure, currently $31,575.
What is the Maryland median income for the means test?
For cases filed on or after April 1, 2026, the Maryland median family income is $86,928 for 1 person, $114,611 for 2, $135,949 for 3, and $166,173 for 4, adding $11,100 for each additional person. The U.S. Trustee Program updates these figures periodically.
How do I protect my car in a Maryland bankruptcy?
Maryland has no separate motor-vehicle exemption, so filers protect vehicle equity using the $6,000 wildcard under 11-504(b)(6) and, in bankruptcy, the additional $5,000 personal-property allowance. Whether your car is fully protected depends on its equity.
Will I lose my house if I file bankruptcy in Maryland?
Maryland's homestead protects up to $31,575 of equity, which is modest, so a homeowner with substantial equity should consider whether Chapter 13 is a better fit. Many homeowners with little equity keep their homes in Chapter 7 as long as they stay current on the mortgage.
Where do I file for bankruptcy in Maryland?
All Maryland bankruptcy cases are filed in the U.S. Bankruptcy Court for the District of Maryland, which sits in Baltimore and Greenbelt. You must complete approved credit counseling before filing.
What debts cannot be discharged in a Maryland bankruptcy?
Most student loans (absent a showing of undue hardship), recent income taxes, child support, alimony, and debts arising from fraud generally are not discharged. Most credit-card and medical debt usually is.
Updates
Clarified that income at or below the state median means the presumption of abuse does not arise under the Chapter 7 means test, not that a filer qualifies for Chapter 7.
Corrected the wage discussion to explain that Maryland protects earned but unpaid wages through Commercial Law 15-601.1 rather than through the bankruptcy exemption statute, clarified that the homestead cannot be claimed by both spouses in the same bankruptcy case (the 8-year limit is the separate property-based restriction), and added the automatic $500 deposit-account exemption along with the $6,000 cap it shares with the wildcard.
Independently fact-checked against the cited primary sources; governing law re-checked for recent changes
Governing law re-checked for recent changes
Governing law re-checked for recent changes
Reviewed and approved by an editor
The Law Behind This Article
This article rests on the statutory provisions below, held in our own legal record and retrieved from the official source. Tap a section to read the operative text.
Maryland Code, Courts and Judicial Proceedings Article
§ 11-504In forcecited in 4 of our articles
§11–504. (a) (1) In this section the following words have the meanings indicated. (2) “Depository institution” means a bank, credit union, trust company, savings bank, or savings and loan association, or any of their affiliates or subsidiaries. (3) “Value” means fair market value as of the date on which the execution or other judicial process becomes effective against the property of the debtor, or the date of filing the petition under the federal Bankruptcy Code. (b) The following items are exempt from execution on a judgment: (1) Wearing apparel, books, tools, instruments, or appliances, in an amount not to exceed $5,000 in value necessary for the practice of any trade or profession except those kept for sale, lease, or barter. (2) Except as provided in subsection (i) of this section, money payable in the event of sickness, accident, injury, or death of any person, including compensation for loss of future earnings. This exemption includes but is not limited to money payable on account of judgments, arbitrations, compromises, insurance, benefits, compensation, and relief.
Official text (excerpt) · last checked 2026-09-06 · Read the full text in our law library · Verify at mgaleg.maryland.gov
Cited in 21 court opinions in our collectionLatest citing opinion in our collection: 2025
Opinions citing this section in our collection:
- In Re Gordon (United States Bankruptcy Court, D. Maryland 1996, 199 B.R. 7)“…reditor in the above referenced matter. By the enactment of Md.Code Ann., Cts. & Jud.Proc. § 11-504(g) (1995), Maryland opted out of the fe…”
- Governor Plaza Associates v. Butcher (In Re Butcher) (Court of Appeals for the Fourth Circuit 1997, 124 F.3d 238)“…ttlement, as permitted by the Maryland exemp- tion statute, Md. Code Ann., Cts. & Jud. Proc. § 11-504(b)(2). Governor Plaza Associates, a cr…”
- McCullough v. Liberty Heights Health & Rehabilitation Center (District Court, D. Maryland 2011, 830 F. Supp. 2d 94)“…injuries to property, and punitive damages are not. Id.; Md. Code Ann. Cts. & Jud. Proc. § 11-504(b). McCullough’s Amended Complaint se…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
Also relied on in: Maryland Debt Collection Laws: Wage Garnishment, Statute of Limitations, and Repossession, Maryland Homestead Exemption: Tax Credit, Deadline and How to Apply, Maryland Small Claims Court: $5,000 Limit, Fees and How to File
United States Code Title 11
§ 522ExemptionsIn forcecited in 54 of our articles
In this section— “dependent” includes spouse, whether or not actually dependent; and “value” means fair market value as of the date of the filing of the petition or, with respect to property that becomes property of the estate after such date, as of the date such property becomes property of the estate. Notwithstanding section 541 of this title, an individual debtor may exempt from property of the estate the property listed in either paragraph (2) or, in the alternative, paragraph (3) of this subsection. In joint cases filed under section 302 of this title and individual cases filed under section 301 or 303 of this title by or against debtors who are husband and wife, and whose estates are ordered to be jointly administered under Rule 1015(b) of the Federal Rules of Bankruptcy Procedure, one debtor may not elect to exempt property listed in paragraph (2) and the other debtor elect to exempt property listed in paragraph (3) of this subsection. If the parties cannot agree on the alternative to be elected, they shall be deemed to elect paragraph (2), where such election is permitted under the law of the jurisdiction where the case is filed.
Official text (excerpt) · last checked 2026-09-16 · Read the full text in our law library · Verify at uscode.house.gov
Cited in 7,574 court opinions in our collectionLatest citing opinion in our collection: 2026
In the courts (editorial summary, independently checked):Taylor v. Freeland & Kronz (1992) held that a trustee who does not object within the 30-day period cannot later challenge an exemption claimed under 522(l), even one with no statutory basis. Owen v. Owen (1991) held that 522(f) lien avoidance is not defeated by a state exemption written to exclude lien-encumbered property.
Opinions citing this section in our collection:
- Taylor v. Freeland & Kronz (Supreme Court of the United States 1992, 503 U.S. 638)✓A Chapter 7 debtor listed the entire proceeds of her TWA discrimination suit as exempt and the trustee let the 30-day objection window lapse; the Court held that under § 522(l) the property is exempt once no one objects, even absent a colorable statutory basis.
- Patterson v. Shumate (Supreme Court of the United States 1992, 504 U.S. 753)✓A debtor's $250,000 ERISA pension interest was excluded from his estate under § 541(c)(2); answering a surplusage argument, the Court read § 522(d)(10)(E) as exempting a broader set of plans, and expressly declined to decide whether § 522(b)(2)(A) also applied.
- Owen v. Owen (Supreme Court of the United States 1991, 500 U.S. 305)✓An ex-wife's judgment lien attached to a Florida condo before state law made it a homestead; the Court held § 522(f) measures impairment against the exemption the debtor would have had but for the lien, so Florida's carve-out for prior liens did not defeat avoidance.
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
Also relied on in: Bankruptcy Laws by State (2026): Exemptions & Means Test, Bankruptcy in Alabama (2026): Exemptions & Means Test, Bankruptcy in Alaska (2026): Exemptions & Means Test
§ 104Adjustment of dollar amountsIn forcecited in 2 of our articles
On April 1, 1998, and at each 3-year interval ending on April 1 thereafter, each dollar amount in effect under sections 101(3), 101(18), 101(19A), 101(51D), 109(e), 303(b), 507(a), 522(d), 522(f)(3) and 522(f)(4), 522(n), 522(p), 522(q), 523(a)(2)(C), 541(b), 547(c)(9), 707(b), 1182(1), 1322(d), 1325(b), and 1326(b)(3) of this title and section 1409(b) of title 28 immediately before such April 1 shall be adjusted— to reflect the change in the Consumer Price Index for All Urban Consumers, published by the Department of Labor, for the most recent 3-year period ending immediately before January 1 preceding such April 1, and to round to the nearest $25 the dollar amount that represents such change. Not later than March 1, 1998, and at each 3-year interval ending on March 1 thereafter, the Judicial Conference of the United States shall publish in the Federal Register the dollar amounts that will become effective on such April 1 under sections 101(3), 101(18), 101(19A), 101(51D), 109(e), 303(b), 507(a), 522(d), 522(f)(3) and 522(f)(4), 522(n), 522(p), 522(q), 523(a)(2)(C), 541(b), 547(c)(9), 707(b), 1182(1), 1322(d), 1325(b), and 1326(b)(3) of this title and section 1409(b) of title 28.
Official text (excerpt) · last checked 2026-07-28 · Read the full text in our law library · Verify at uscode.house.gov
Cited in 1,124 court opinions in our collectionLatest citing opinion in our collection: 2026
Opinions citing this section in our collection:
- Alyeska Pipeline Service Co. v. Wilderness Society (Supreme Court of the United States 1975, 421 U.S. 240)“…ct, 46 Stat. 535 , 7 U. S. C. § 499g (b); Bankruptcy Act, 11 U. S. C. § 104 (a) (1), 641-644; Clayton Act, § 4, 3…”
- Reading Co. v. Brown (Supreme Court of the United States 1968, 391 U.S. 471)“…ctively under the second and fourth subdivisions of § 64a, 11 U. S. C. §§104 (a) (2), 104(a)(4). The government tax…”
- Nicholas v. United States (Supreme Court of the United States 1966, 384 U.S. 678)“…debts to the status of a fourth priority, 52 Stat. 874 , 11 U. S. C. § 104 (a) (1964 ed.), and by requiring tax c…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
§ 362Automatic stayIn forcecited in 54 of our articles
Except as provided in subsection (b) of this section, a petition filed under section 301, 302, or 303 of this title, or an application filed under section 5(a)(3) of the Securities Investor Protection Act of 1970, operates as a stay, applicable to all entities, of— the commencement or continuation, including the issuance or employment of process, of a judicial, administrative, or other action or proceeding against the debtor that was or could have been commenced before the commencement of the case under this title, or to recover a claim against the debtor that arose before the commencement of the case under this title; the enforcement, against the debtor or against property of the estate, of a judgment obtained before the commencement of the case under this title; any act to obtain possession of property of the estate or of property from the estate or to exercise control over property of the estate; any act to create, perfect, or enforce any lien against property of the estate; any act to create, perfect, or enforce against property of the debtor any lien to the extent that such lien secures a claim that arose before the commencement of the case under this title; any act to…
Official text (excerpt) · last checked 2026-09-16 · Read the full text in our law library · Verify at uscode.house.gov
Cited in 19,606 court opinions in our collectionLatest citing opinion in our collection: 2026
In the courts (editorial summary, independently checked):United Sav. Assn. of Tex. v. Timbers of Inwood Forest Associates, Ltd. (1988) held that an undersecured creditor gets no interest as adequate protection under 362(d)(1) for delay caused by the stay. NLRB v. Bildisco & Bildisco (1984) applied 362(a) in requiring claims be pursued through bankruptcy administration, not suit.
Opinions citing this section in our collection:
- Clinton v. Jones (Supreme Court of the United States 1997, 520 U.S. 681)“…ublic interests. Brief for Petitioner 34-36. See, e. g., 11 U. S. C. § 362 (litigation against debtor stayed upon…”
- United Sav. Assn. of Tex. v. Timbers of Inwood Forest Associates, Ltd. (Supreme Court of the United States 1988, 484 U.S. 365)✓An undersecured lender on a Houston apartment project sought monthly payments as the price of continuing the § 362(a) automatic stay; the Court held that 'adequate protection' under § 362(d)(1) does not entitle it to interest for the delay in foreclosing on its collateral.
- Pennzoil Co. v. Texaco Inc. (Supreme Court of the United States 1987, 481 U.S. 1)“…if it were forced to file for bankruptcy under Chapter 11. 11 U. S. C. §362 . Texaco, or its successor in interest,…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
Also relied on in: Bankruptcy in Arizona (2026): Exemptions & Means Test, Bankruptcy in Arkansas (2026): Exemptions & Means Test, Bankruptcy in California (2026): Exemptions & Means Test
Maryland Code, Commercial Law Article
§ 15-601.1In forcecited in 2 of our articles
§15–601.1. (a) In this section, “disposable wages” means the part of wages that remain after deduction of any amount required to be withheld by law. (b) The following are exempt from attachment: (1) The greater of: (i) 75 percent of the disposable wages due; or (ii) 30 times the State minimum hourly wage in effect at the time the wages are due, multiplied by the number of weeks during which the wages due were earned; and (2) Any medical insurance payment deducted from an employee’s wages by the employer. (c) The amount subject to attachment shall be calculated per pay period.
Official text (excerpt) · last checked 2026-07-29 · Read the full text in our law library · Verify at mgaleg.maryland.gov
Cited in 2 court opinions in our collectionLatest citing opinion in our collection: 2025
Opinions citing this section in our collection:
- Fatima Maria Ramirez Ruano v. Scratch Kitchen & Bistro, LLC, et al. (District Court, D. Maryland 2025)“…407; Md. Code Ann., Cts. & Jud. Proc. § 11-504; Md. Code Ann., Com. Law § 15-601.1.…”
- Katherine E. Wyatt-Burrows (United States Bankruptcy Court, D. Maryland 2025)“…of the disposable wages due” are exempt from attachment. Md. Code Ann., Com. Law § 15-601.1. Subsection (f) provides in releva…”
Identified automatically from the court opinions citing this section — not a ranking of which case controls.
Sources and References
- Md. Code, Cts. & Jud. Proc. 11-504, Maryland exemptions including opt-out (g), homestead (f), and $6,000 wildcard (b)(6)(mgaleg.maryland.gov).gov
- U.S. Trustee Program, Census Bureau Median Family Income by family size, cases filed on or after April 1, 2026(justice.gov).gov
- 11 U.S.C. 522, including the 522(d)(1) homestead figure that Maryland's homestead tracks and the state opt-out authority(law.cornell.edu)
- Maryland Judiciary People's Law Library, property exempt in bankruptcy under Maryland law(peoples-law.org).gov
- U.S. Bankruptcy Court for the District of Maryland (Baltimore and Greenbelt)(mdb.uscourts.gov).gov
- Md. Code, Commercial Law 15-601.1(b), Maryland wage exemption from attachment (greater of 75 percent of disposable wages or 30 times the State minimum hourly wage per week)(mgaleg.maryland.gov)
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