What Types of Debts Are Not Dischargeable Debt?
The objective of both Chapter 7 and Chapter 13 bankruptcy is to obtain a “discharge” of debts. The bankruptcy court will discharge your bankruptcy debts, meaning that you are no longer personally responsible for them. The majority of consumer debt, including credit card and medical bills, can be discharged. Some debts are not dischargeable debt. This means they can’t be erased through bankruptcy. These debts are those Congress has deemed ineligible for discharge.
There are 19 types of non-dischargeable debt. This means that creditors can still collect these debts even after you have been discharged from your consumer debts. Non-dischargeable loans are not subject to a hearing. However, creditors can still collect these categories of debts even if they do not contest their discharge ability.
These debts are usually non-dischargeable debt and you will need to prove extraordinary circumstances.
- You may not have disclosed to creditors that you filed a bankruptcy petition.
- Many types of taxes;
- Support for children or alimony
- Government agencies may be subject to penalties or fines.
- Student loans
- Personal injury debts that result from a drunk driving accident
- Tax-advantaged retirement plans can lead to debts
- Condo or cooperative housing fee debts;
- For child support or custody, attorneys’ fees
- Criminal restitution and other court penalties or fines.
To be dischargeable debt, you will need to challenge the bankruptcy filings of creditors with other non-dischargeable debt types. A hearing will be held by the court that allows both the bankruptcy petitioner and the creditor to present arguments. The court will discharge the debt if either the creditor objects or the court disagrees. These include credit card purchases of luxury goods totaling more than $650 that was made within the last 90 days. They are owed to one creditor. Fraudulently obtained debts or debts obtained under false pretenses are also included.
Can The Court Deny Discharge?
Sometimes, a bankruptcy court may deny a Chapter 7 bankruptcy release because a debtor has not followed the rules and procedure. The court can deny a Chapter 7 discharge if you are found guilty of perjury, fail or destroy records, conceal assets or deceive creditors. Creditors, the bankruptcy trustee, and the U.S. can also object to your discharge. Your discharge can be opposed by the trustee. The bankruptcy court is the final judge.
If you file bankruptcy cases too often within a short time frame, your discharge may not be granted. For example, if you file successive Chapter 7 cases, you cannot receive a discharge in the second case if it is within eight years of the filing date for your first case. You cannot get a discharge in a subsequent Chapter 13 case if it is filed within two years of the filing date for your first Chapter 13 bankruptcy case.
The order will determine how long it takes to get a discharge in the other case if you file under two chapters. For example, if you file for Chapter 13, you cannot file under Chapter 7 and receive a discharge within six years from the date you filed your Chapter 13 case, with certain exceptions. You cannot get a discharge if you file Chapter 7 and you do not receive a discharge.