EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTING LAW .
[Brackets] indicate matter deleted from existing law.
*sb0106*
SENATE BILL 106
D3 3lr0579
HB 322/22 – JUD (PRE–FILED) CF HB 42
By: Senator Sydnor
Requested: October 19, 2022
Introduced and read first time: January 11, 2023
Assigned to: Judicial Proceedings
A BILL ENTITLED
AN ACT concerning 1
Courts – Judgments – Exemptions From Execution 2
FOR the purpose of exempting up to a certain amount of money in certain accounts of a 3
judgment debtor from execution on the judgment without an election by the debtor 4
to exempt the money; establishing a certain limit on the cumulative value of property 5
and cash that may be exempted; requiring a writ of garnishment issued for certain 6
accounts to instruct the garnishee that it is to garnish only a certain amount; and 7
generally relating to exemptions from execution of a judgment. 8
BY repealing and reenacting, with amendments, 9
Article – Courts and Judicial Proceedings 10
Section 11–504 11
Annotated Code of Maryland 12
(2020 Replacement Volume and 2022 Supplement) 13
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 14
That the Laws of Maryland read as follows: 15
Article – Courts and Judicial Proceedings 16
11–504. 17
(a) In this section, “value” means fair market value as of the date upon which the 18
execution or other judicial process becomes effective against the property of the debtor, or 19
the date of filing the petition under the federal Bankruptcy Code. 20
(b) The following items are exempt from execution on a judgment: 21
(1) Wearing apparel, books, tools, instruments, or appliances, in an amount 22
not to exceed $5,000 in value necessary for the practice of any trade or profession except 23 2 SENATE BILL 106
those kept for sale, lease, or barter. 1
(2) Except as provided in subsection (i) of this section, money payable in 2
the event of sickness, accident, injury, or death of any person, including compensation for 3
loss of future earnings. This exemption includes but is not limited to money payable on 4
account of judgments, arbitrations, compromises, insurance, benefits, compensation, and 5
relief. Disability income benefits are not exempt if the judgment is for necessities contracted 6
for after the disability is incurred. 7
(3) Professionally prescribed health aids for the debtor or any dependent of 8
the debtor. 9
(4) The debtor’s interest, not to exceed $1,000 in value, in household 10
furnishings, household goods, wearing apparel, appliances, books, animals kept as pets, 11
and other items that are held primarily for the personal, family, or household use of the 12
debtor or any dependent of the debtor. 13
(5) UP TO $500 IN A DEPOSIT ACCOUNT OR OTHER ACCOUNT OF THE 14
DEBTOR HELD BY A BAN K, CREDIT UNION , TRUST COMPANY , SAVINGS BANK , OR 15
SAVINGS AND LOAN ASS OCIATION OR ANY OF T HEIR AFFILIATES OR S UBSIDIARIES, 16
WITHOUT ELECTION OF THE DEBTOR . 17
[(5)] (6) Cash or property of any kind equivalent in value to $6,000 is 18
exempt, if within 30 days from the date of the attachment or the levy by the sheriff, the 19
debtor elects to exempt cash or selected items of property in an amount not to exceed a 20
cumulative value of $6,000, EXCEPT THAT THE CUMU LATIVE VALUE OF CASH AND 21
PROPERTY EXEMPTED UN DER THIS ITEM AND IT EM (5) OF THIS SUBSECTION M AY 22
NOT EXCEED $6,000. 23
[(6)] (7) Money payable or paid in accordance with an agreement or court 24
order for child support. 25
[(7)] (8) Money payable or paid in accordance with an agreement or court 26
order for alimony to the same extent that wages are exempt from attachment under [§ 27
15–601.1(b)(1)(ii) or (2)(i)] § 15–601.1(B)(1)(I) of the Commercial Law Article. 28
[(8)] (9) The debtor’s beneficial interest in any trust property that is 29
immune from the claims of the debtor’s creditors under § 14.5–511 of the Estates and Trusts 30
Article. 31
[(9)] (10) With respect to claims by a separate creditor of a husband or 32
wife, trust property that is immune from the claims of the separate creditors of the husband 33
or wife under § 14.5–511 of the Estates and Trusts Article. 34
(c) (1) (I) In order to determine whether the property listed in subsection 35
(b)(4) and [(5)] (6) of this section is subject to execution, the sheriff shall appraise the 36 SENATE BILL 106 3
property at the time of levy. The sheriff shall return the appraisal with the writ. 1
[(2)] (II) An appraisal made by the sheriff under this [subsection] 2
PARAGRAPH is subject to review by the court on motion of the debtor. 3
[(3)] (III) Procedures will be as prescribed by rules issued by the Court of 4
Appeals. 5
(2) A WRIT OF GARNISHMENT ISSUED FOR A DEPOSIT ACCOUNT OR 6
OTHER ACCOUNT HELD B Y A BANK, CREDIT UNION, TRUST COMPANY , SAVINGS BANK, 7
OR SAVINGS AND LOAN ASSOCIATION OR ANY O F THEIR AFFILIATES O R 8
SUBSIDIARIES SHALL I NSTRUCT THE GARNISHE E THAT, SUBJECT TO ADDITIONA L 9
EXEMPTIONS, IT IS TO GARNISH ONL Y THE AMOUNT EXCEEDI NG THE AMOUNT 10
EXEMPTED WITHOUT ELE CTION OF THE DEBTOR . 11
(d) The debtor may not waive, by cognovit note or otherwise, the provisions of 12
subsections (b) and (h) of this section. 13
(e) The exemptions in this section do not apply to wage attachments. 14
(f) (1) (i) In addition to the exemptions provided in subsection (b) of this 15
section, and in other statutes of this State, in any proceeding under Title 11 of the United 16
States Code, entitled “Bankruptcy”, any individual debtor domiciled in this State may 17
exempt the debtor’s aggregate interest in: 18
1. Personal property, up to $5,000; and 19
2. Subject to subparagraph (ii) of this paragraph: 20
A. Owner–occupied residential real property, including a 21
condominium unit or a manufactured home that has been converted to real property in 22
accordance with § 8B–201 of the Real Property Article; or 23
B. A cooperative housing corporation that owns property that 24
the debtor occupies as a residence. 25
(ii) The exemption allowed under subparagraph (i)2 of this 26
paragraph may not exceed the amount under 11 U.S.C. § 522(d)(1), adjusted in accordance 27
with 11 U.S.C. § 104, subject to the provisions of paragraphs (2) and (3) of this subsection. 28
(2) An individual may not claim the exemption under paragraph (1)(i)2 of 29
this subsection on a particular property if: 30
(i) The individual has claimed successfully the exemption on the 31
property within 8 years prior to the filing of the bankruptcy proceeding in which the 32
exemption under this subsection is claimed; or 33 4 SENATE BILL 106
(ii) The individual’s spouse, child, child’s spouse, parent, sibling, 1
grandparent, or grandchild has claimed successfully the exemption on the property within 2
8 years prior to the filing of the bankruptcy proceeding in which the exemption under this 3
subsection is claimed. 4
(3) The exemption under paragraph (1)(i)2 of this subsection may not be 5
claimed by both a husband and wife in the same bankruptcy proceeding. 6
(g) In any bankruptcy proceeding, a debtor is not entitled to the federal 7
exemptions provided by § 522(d) of the federal Bankruptcy Code. 8
(h) (1) In addition to the exemptions provided in subsections (b) and (f) of this 9
section and any other provisions of law, any money or other assets payable to a participant 10
or beneficiary from, or any interest of any participant or beneficiary in, a retirement plan 11
qualified under § 401(a), § 403(a), § 403(b), § 408, § 408A, § 414(d), or § 414(e) of the United 12
States Internal Revenue Code of 1986, as amended, or § 409 (as in effect prior to January 13
1984) of the United States Internal Revenue Code of 1954, as amended, shall be exempt 14
from any and all claims of the creditors of the beneficiary or participant, other than claims 15
by the Maryland Department of Health. 16
(2) Paragraph (1) of this subsection does not apply to: 17
(i) An alternate payee under a qualified domestic relations order, as 18
defined in § 414(p) of the United States Internal Revenue Code of 1986, as amended; 19
(ii) A retirement plan, qualified under § 401(a) of the United States 20
Internal Revenue Code of 1986, as amended, as a creditor of an individual retirement 21
account qualified under § 408 of the United States Internal Revenue Code of 1986, as 22
amended; or 23
(iii) The assets of a bankruptcy case filed before January 1, 1988. 24
(3) The interest of an alternate payee in a plan described under paragraph 25
(1) of this subsection shall be exempt from any and all claims of any creditor of the alternate 26
payee, except claims by the Maryland Department of Health. 27
(4) If a contribution to a retirement plan described under paragraph (1) of 28
this subsection exceeds the amount deductible or, in the case of contribution under § 408A 29
of the Internal Revenue Code, the maximum contribution allowed under the applicable 30
provisions of the United States Internal Revenue Code of 1986, as amended, the portion of 31
that contribution that exceeds the amount deductible or, in the case of contribution under 32
§ 408A of the Internal Revenue Code, the maximum contribution allowed, and any accrued 33
earnings on such a portion, are not exempt under paragraph (1) of this subsection. 34
(i) (1) In this subsection, “net recovery” means the sum of money to be 35
distributed to the debtor after deduction of attorney’s fees, expenses, medical bills, and 36 SENATE BILL 106 5
satisfaction of any liens or subrogation claims arising out of the claims for personal injury, 1
including those arising under: 2
(i) The Medicare Secondary Payer Act, 42 U.S.C. § 1395y; 3
(ii) A program of the Maryland Department of Health for which a 4
right of subrogation exists under §§ 15–120 and 15–121.1 of the Health – General Article; 5
(iii) An employee benefit plan subject to the federal Employee 6
Retirement Income Security Act of 1974; or 7
(iv) A health insurance contract. 8
(2) Twenty–five percent of the net recovery by the debtor on a claim for 9
personal injury is subject to execution on a judgment for a child support arrearage. 10
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall be construed to 11
apply only prospectively and may not be applied or interpreted to have any effect on or 12
application to any writ of garnishment or writ of execution issued before the effective date 13
of this Act. 14
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect 15
October 1, 2023. 16