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Consumer Bankruptcy Tax Debt Relief Office in Greenbelt, MD

What to know about the wildcard bankruptcy exemption

The United States Bankruptcy Court District of Maryland reported 7,305 bankruptcy filings in the state for 2022. Bankruptcy can be a challenging and complex process, providing individuals with an opportunity for a fresh financial start.

In Maryland, there are specific bankruptcy exemptions that allow filers to protect certain assets from liquidation to pay off their debts. Among these exemptions, the wildcard exemption stands out as a versatile tool for individuals seeking bankruptcy relief.

Understanding wildcard exemption

The wildcard exemption is a unique provision that allows filers to exempt any property of their choice up to a certain dollar value. Unlike many other exemptions, which are for specific types of assets, such as homestead exemptions for homes or exemptions for personal property, filers can apply the wildcard exemption to any personal property or asset. This gives filers more flexibility in protecting assets that other exemptions may not cover.

Dollar limitations

It is important to note that Maryland’s wildcard exemption has a dollar limit. The exact amount can change over time due to adjustments for inflation, so it is important to check the current limits when considering bankruptcy. When a filer claims the wildcard exemption, they can protect any asset, such as a vehicle, a bank account or personal belongings, up to the specified dollar value.

Choosing assets to protect

This exemption allows filers to prioritize their most valuable or important assets. For example, if a filer has a car worth more than the vehicle exemption limit, they may use the wildcard exemption to protect the car. Alternatively, if a filer has valuable personal property, such as electronics or collectibles, they can use the wildcard exemption to keep those assets.

The wildcard bankruptcy exemption in Maryland offers individuals a valuable way to protect their assets when filing for bankruptcy. To make the most of the wildcard exemption, individuals should make sure they understand all the exemption rules to maximize the protection under them.