Some Debts Cannot Be Discharged in Bankruptcy

Although filing for bankruptcy will remove much of your unsecured debt, there are still several types of debt that cannot be eliminated. Rules regarding bankruptcy specifically identify the following items as exempt from release per Section 523(a) of the Bankruptcy Code.

In a Chapter 7 bankruptcy, you cannot eliminate:

Child support or alimony

Certain tax debt

Student loans

Luxury items worth more than $500 purchased within 90 days of filing bankruptcy

Government fines

Cash advances above $750 made within 70 days of filing bankruptcy

Debts that are deemed fraudulent

Damages that result from the malicious or willful injury of another

Condominium or home owner’s association fees

Personal injury or death from the operation of a vessel, vehicle, or aircraft

Debts that are not listed on your schedules

If you have a debt that is a result of malice or fraud, this is not automatically exempt from bankruptcy discharge. Creditors must act and specifically ask that the court to prevent the discharge of this kind of debts. If the creditor fails to act, then the debt is discharged.

If you file a Chapter 13 bankruptcy, you cannot eliminate:

Student loans

Government fines

Alimony or child support payments

Drunken driving judgments

Certain kinds of tax debt

Debts that result from compensation or fine from a criminal case

One type of debt that might be possible to eliminate from a Chapter 13 bankruptcy is a debt that results from wrongdoing or fraud that is deemed intentional. In this case, the creditor must file and prevail in an action and request to have the debts ruled non dischargeable. If the creditor does not, then the debtor will receive the discharge of debt.