Filing Chapter 7 Bankruptcy in Maryland (2026)
Reviewed by DocDraft Legal Team · Maryland · Last updated August 18, 2026
Chapter 7 bankruptcy is federal law, but the property you keep in Maryland is set by Maryland's own exemption statute. Maryland is an opt-out state: under Md. Code, Courts and Judicial Proceedings section 11-504(g) you must use Maryland's exemptions and cannot choose the federal 522(d) list. This page explains Maryland's homestead exemption under section 11-504(f), the $6,000 cash exemption and $5,000 general wildcard under section 11-504(b), how Maryland protects wages and retirement, the means-test median income for Maryland, and the U.S. Bankruptcy Court for the District of Maryland where you file. Chapter 7 discharges most unsecured debt but not most student loans, recent taxes, child support, or alimony.
Does Maryland use state or federal bankruptcy exemptions?
Maryland is an opt-out state. Under Md. Code, Courts and Judicial Proceedings section 11-504(g), a debtor filing in Maryland must use Maryland's exemptions and cannot elect the federal 11 U.S.C. 522(d) list. Certain federal non-bankruptcy protections, such as ERISA retirement plans, still apply alongside the Maryland set.
Can I keep my house if I file Chapter 7 in Maryland?
Often yes. Under Md. Code, Courts and Judicial Proceedings section 11-504(f), Maryland's homestead exemption protects up to $31,575 of equity in owner-occupied residential property, tied to the federal 522(d)(1) figure and adjusted periodically. If your home equity fits within that amount, Chapter 7 generally lets you keep the house.
Can I keep my car if I file Chapter 7 in Maryland?
Sometimes. Maryland has no motor-vehicle-specific exemption, so you protect a car using the general exemptions: the $6,000 cash-or-property exemption under section 11-504(b)(5) plus the $5,000 wildcard under section 11-504(b)(1). If your car equity fits within those amounts, the vehicle is protected; higher equity may be reachable.
What is the income limit to file Chapter 7 in Maryland?
For cases filed on or after July 15, 2026, the U.S. Trustee median income figures for Maryland are $86,928 for one earner, $114,611 for two, $135,949 for three, and $166,173 for four, adding $11,100 per additional person. At or below your household figure, you pass the first part of the means test.
Maryland's Opt-Out Rule, the $31,575 Homestead, and the Wildcard-Only Car
Maryland is a bankruptcy opt-out state. Under Md. Code, Courts and Judicial Proceedings section 11-504(g), a debtor filing in Maryland must use Maryland's exemptions and cannot choose the federal 11 U.S.C. 522(d) set, though federal non-bankruptcy protections like ERISA-qualified retirement plans still apply. Maryland's homestead exemption under section 11-504(f) protects up to $31,575 of equity in owner-occupied residential property; the figure is tied to the federal 522(d)(1) homestead amount and is adjusted periodically, and it can only be claimed in bankruptcy. Maryland has no motor-vehicle-specific exemption, which makes its two general exemptions the workhorses of a Maryland filing: a $6,000 cash-or-property exemption under section 11-504(b)(5), claimed within 30 days, and a $5,000 wildcard in any property under section 11-504(b)(1). A filer typically stacks these to protect a car, a bank balance, or other assets. Tools of the trade are exempt to $5,000 under section 11-504(b)(1), and wages are protected under Md. Code, Commercial Law section 15-601.1. Marylanders file in a single federal court: the U.S. Bankruptcy Court for the District of Maryland, which sits in Baltimore and Greenbelt.
Relevant Laws
Maryland Homestead Exemption (Cts. and Jud. Proc. 11-504(f))
Sets Maryland's homestead exemption at up to $31,575 of equity in owner-occupied residential property, tied to the federal 11 U.S.C. 522(d)(1) amount and adjusted periodically. This exemption may only be claimed in a bankruptcy case and is what lets many Maryland homeowners keep their house in Chapter 7.
Maryland Exemption Opt-Out (Cts. and Jud. Proc. 11-504(g))
The statute by which Maryland opts out of the federal exemptions. Under section 11-504(g), a debtor filing bankruptcy in Maryland may not elect the federal 11 U.S.C. 522(d) exemptions and must use the Maryland set, though federal non-bankruptcy protections still apply.
Maryland Cash and Wildcard Exemptions (Cts. and Jud. Proc. 11-504(b))
Section 11-504(b)(5) exempts $6,000 in cash or property claimed within 30 days, and section 11-504(b)(1) exempts $5,000 in any property plus tools of the trade. Because Maryland has no vehicle-specific exemption, these general exemptions are used to protect a car.
Federal Bankruptcy Code Exemptions and Means Test (11 U.S.C. 522, 707)
The federal law behind Chapter 7. Section 522(b)(2) lets a state opt out of the federal 522(d) exemptions, which Maryland has done, and section 707(b) sets the means test measured against state median income.
Regional Variances
Maryland Chapter 7 Exemption Table
Homestead
Md. Code, Cts. and Jud. Proc. 11-504(f): up to $31,575 of equity in owner-occupied residential property, tied to the federal 11 U.S.C. 522(d)(1) figure and adjusted periodically. It may only be claimed in bankruptcy, not against ordinary creditors outside a case.
Motor vehicle
Maryland has no motor-vehicle-specific exemption. A car is protected by combining the $6,000 cash-or-property exemption under 11-504(b)(5) with the $5,000 wildcard under 11-504(b)(1), up to $11,000 of equity. Equity above that may be reachable by the trustee.
Wildcard
Md. Code, Cts. and Jud. Proc. 11-504(b)(1): $5,000 in any property. This is separate from the $6,000 cash-or-property exemption under 11-504(b)(5), which must be claimed within 30 days. Together they cover assets Maryland does not exempt by category.
Personal property
Md. Code, Cts. and Jud. Proc. 11-504(b): wearing apparel, books, tools, instruments, and appliances necessary for trade or profession are exempt to $5,000, and household furnishings, goods, and appliances are exempt to $1,000 under 11-504(b)(4). Health aids necessary for the debtor are fully exempt.
Wages
Md. Code, Commercial Law 15-601.1: earned but unpaid wages are exempt to the greater of 75 percent of disposable wages or $145 per week in most counties; in Caroline, Kent, Queen Anne's, and Worcester counties the floor is the greater of 75 percent or 30 times the federal minimum hourly wage.
Retirement and tools
Md. Code, Cts. and Jud. Proc. 11-504(h): most tax-qualified retirement plans, including IRAs and pensions, are exempt from creditor claims. ERISA-qualified plans are separately excluded from the bankruptcy estate under federal law. Tools of the trade are exempt to $5,000 under 11-504(b)(1).
Suggested Compliance Checklist
Confirm the current Maryland means-test median income
Before you file days after startingCheck your household size against the U.S. Trustee Maryland median income figures in effect on your filing date, since these update periodically. For cases filed on or after July 15, 2026 the figures are $86,928 for one, $114,611 for two, $135,949 for three, and $166,173 for four, adding $11,100 per additional person.
Complete the pre-filing credit counseling course
Within 180 days before filing days after startingTake an approved credit counseling course from a provider authorized for the District of Maryland and keep the certificate. You must file it with your petition. Skipping this can get your case dismissed before your debts are addressed.
Apply the Maryland exemptions and value your assets
Before preparing your schedules days after startingValue your home, vehicle, and personal property, then map the $31,575 homestead under 11-504(f), the $6,000 cash exemption under 11-504(b)(5), and the $5,000 wildcard under 11-504(b)(1) onto those assets. Because Maryland has no car exemption, plan how to stack the general exemptions over a vehicle.
Prepare and file your petition and schedules
Filing day days after startingFile your petition, schedules, and exemption claims in the U.S. Bankruptcy Court for the District of Maryland, based on where you have lived for most of the prior 180 days. Filing triggers the automatic stay that pauses collection and garnishment.
Attend the 341 meeting and finish the debtor education course
Before discharge days after startingAttend the 341 meeting of creditors and answer the trustee's questions under oath, then complete the required post-filing financial management course and file the certificate. Both are required before the court will grant your discharge. An attorney can help with contested exemptions.
| Task | Description | Document | Days after starting |
|---|---|---|---|
| Confirm the current Maryland means-test median income | Check your household size against the U.S. Trustee Maryland median income figures in effect on your filing date, since these update periodically. For cases filed on or after July 15, 2026 the figures are $86,928 for one, $114,611 for two, $135,949 for three, and $166,173 for four, adding $11,100 per additional person. | - | Before you file |
| Complete the pre-filing credit counseling course | Take an approved credit counseling course from a provider authorized for the District of Maryland and keep the certificate. You must file it with your petition. Skipping this can get your case dismissed before your debts are addressed. | - | Within 180 days before filing |
| Apply the Maryland exemptions and value your assets | Value your home, vehicle, and personal property, then map the $31,575 homestead under 11-504(f), the $6,000 cash exemption under 11-504(b)(5), and the $5,000 wildcard under 11-504(b)(1) onto those assets. Because Maryland has no car exemption, plan how to stack the general exemptions over a vehicle. | - | Before preparing your schedules |
| Prepare and file your petition and schedules | File your petition, schedules, and exemption claims in the U.S. Bankruptcy Court for the District of Maryland, based on where you have lived for most of the prior 180 days. Filing triggers the automatic stay that pauses collection and garnishment. | - | Filing day |
| Attend the 341 meeting and finish the debtor education course | Attend the 341 meeting of creditors and answer the trustee's questions under oath, then complete the required post-filing financial management course and file the certificate. Both are required before the court will grant your discharge. An attorney can help with contested exemptions. | - | Before discharge |
Frequently Asked Questions
Under Md. Code, Courts and Judicial Proceedings section 11-504(f), Maryland's homestead exemption protects up to $31,575 of equity in owner-occupied residential property. The figure is tied to the federal 11 U.S.C. 522(d)(1) amount and adjusted periodically, and it can only be claimed in a bankruptcy case, not against ordinary creditors outside bankruptcy.
Maryland has no motor-vehicle-specific exemption, so you protect a car with the general exemptions. Under section 11-504(b)(5) you can exempt $6,000 in cash or property claimed within 30 days, and under section 11-504(b)(1) you can exempt $5,000 in any property. Stacking these covers up to $11,000 of car equity or other assets.
Maryland's general wildcard under Md. Code, Courts and Judicial Proceedings section 11-504(b)(1) exempts up to $5,000 in any property. It is commonly combined with the separate $6,000 cash-or-property exemption under section 11-504(b)(5), which must be claimed within 30 days, to protect a vehicle, a bank balance, or other assets Maryland does not exempt by category.
No. Chapter 7 discharges most unsecured debt like credit cards and medical bills, but it does not erase most student loans, recent income taxes, child support, or alimony, and it will not discharge debts from fraud. Secured debts like a car loan remain unless you surrender the collateral or reaffirm the loan.
Under Md. Code, Commercial Law section 15-601.1, earned but unpaid wages are exempt to the greater of 75 percent of disposable wages or $145 per week in most counties; in Caroline, Kent, Queen Anne's, and Worcester counties the floor is the greater of 75 percent or 30 times the federal minimum hourly wage. This protects a portion of pay owed to you when you file.
Other Maryland guides
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