Non-Dischargeable Debts - What Can You File Bankruptcy On?
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Non-Dischargeable Debts in Bankruptcy

What Types of Debt Can Be included in Bankruptcy?

Many debts may be discharged through bankruptcy; however, this does not apply to all debts. These types of debts are called non-dischargeable debts.

If you file a Chapter 7 bankruptcy case, you will still be responsible for repaying non-dischargeable debts after you receive your bankruptcy discharge.

If you file for Chapter 13 bankruptcy relief, non-dischargeable debts can be paid through your Chapter 13 bankruptcy repayment plan. If the non-dischargeable debts are not paid, the creditor will likely be able to collect on any remaining balance.

Click below to ask a bankruptcy attorney whether your debt could be discharged through bankruptcy:

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What Does Bankruptcy Cover?

While bankruptcy covers most debts, it does not address every debt all the time. Some of the debts listed here may only be included in your bankruptcy filing under certain circumstances. Other may only be included in rare and special cases, or not at all.

If you have questions about which of your debts will be covered in a bankruptcy case, speak with a local bankruptcy lawyer.

Taxes: Income tax debt will not be discharged in your Chapter 7 bankruptcy unless:

  • The income tax is more than three years old
  • The tax return was filed timely
  • The tax return was correct

If the tax return was filed late, but filed more than two years prior to filing the bankruptcy, the tax may be dischargeable if all other requirements are met. There may be special considerations in determining the dischargeability of tax debt. A bankruptcy attorney can determine whether or not your tax debts are dischargeable in bankruptcy.

Student Loans: Any governmental, non-profit or any other loan educational loan as defined by the Internal Code is non-dischargeable unless payment would impose an undue hardship on the debtor. The 2005 bankruptcy code has broadened this exception to discharge.

Bankruptcy laws are designed to provide relief and protection to individuals struggling with debt. Learn how bankruptcy laws can help you by speaking with a local bankruptcy lawyer.

Child Support and Alimony: Child support and alimony cannot be discharged by filing a bankruptcy. Bankruptcy laws provide heightened protection for individuals owed "domestic support obligations," or DSO's. DSO's are debts that accrue before, on or after the day the bankruptcy is filed and are owed to or recoverable by a spouse, former spouse, or child of the bankruptcy petitioner, or a governmental unit.

Marital Debts: Debts incurred in the course of a divorce or separation agreement cannot be discharged in a Chapter 7 bankruptcy. The 2005 bankruptcy code eliminates the requirement that the creditor file a complaint to determine whether the debt is dischargeable. A bankruptcy attorney can clarify the complexities created by the intersection of divorce and bankruptcy.

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Intentional Torts: Debts resulting from a willful or malicious act may not be discharged. Debts resulting from intentional torts and debts incurred by fraud are presumably dischargeable. In this type of situation, the creditor must file a request with the court to have the debt declared non-dischargeable.

Operating Vehicle while Intoxicated: Debts for personal injury or death caused by driving while intoxicated are not dischargeable in bankruptcy.

Recent Credit Purchases/Cash Advances:

  • Consumer debts owed to a single creditor for luxury goods or services are presumed to be non-dischargeable if:
    • they total more than $500, and
    • they are incurred within 90 days of filing the bankruptcy.
  • Cash advances of more than $750 obtained within 70 days of filing the bankruptcy are presumed to be non-dischargeable.

Fines and Citations: Fines for violating the law are non-dischargeable debts. Examples of this type of non-dischargeable debt include traffic tickets and court-ordered criminal restitution.

Fraud: Debts incurred through a fraudulent act, under false pretenses or false representations are non-dischargeable. The creditor is obliged to request a determination of dischargeability based on the alleged fraud. The bankruptcy judge will then rule on whether the debt is discharged after notice and a hearing. Consumers facing allegations or bankruptcy fraud may want to call upon the services of a bankruptcy attorney.

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The above summary is by no means all-inclusive and is not legal advice. Speak to a bankruptcy lawyer in your area for more information on these issues.

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