The Bankruptcy Discharge

• The bankruptcy discharge is the grand prize of bankruptcy, as it allows you to walk away from at least some of your debts. However, the bankruptcy discharge only applies to debts that are dischargeable by the definition of the court. For the most part, unsecured debt, or debt not secured by any collateral, can be discharged in a bankruptcy case. This includes medical bills and general loans such as credit cards. However, other types of unsecured debt, classified as priority debt, cannot be discharged in bankruptcy. Priority debt includes debt such as most back taxes. If you committed fraud while incurring any debt, the court may render that debt non-dischargeable, even if it would normally be discharged.
  
  

Bankruptcy Schedule D

• Bankruptcy Schedule D is where you must list any of your creditors holding secured claims. Secured claims receive special treatment in a bankruptcy case, as they fall somewhere between dischargeable and non-dischargeable debt. While a bankruptcy discharge can dismiss your responsibility to pay back your secured creditors, it does not eliminate the lien they hold against your property. For example, if you finance a car and then declare bankruptcy, you no longer have to pay back the amount of your car loan. However, by virtue of the lien your creditor holds against your car, your creditor can still come and take the car back. Thus, while secured debt is technically dischargeable in bankruptcy, liens are generally non-dischargeable obligations.
  
  

Bankruptcy Schedule E

• Generally, you will list most of your non-dischargeable debts on Schedule E of your bankruptcy petition. Schedule E is for creditors that hold unsecured priority claims against you. Schedule E has nine categories of unsecured priority claims, all of which usually survive a bankruptcy discharge by virtue of their priority status. Common types of priority claims include back taxes, most student loans, domestic support obligations (such as child support), money you owe your employees via either wages or retirement plan contributions, and any claims against you as a result of injury you caused while intoxicated.
  
  

Bankruptcy Schedule F

• Schedule F is where you list all of your general unsecured creditors, such as credit card companies. For the most part, any debt you list in this section is included in your bankruptcy discharge. The exception is if you made any charges you never intended to pay back or engaged in any other type of fraudulent dealings with these creditors. If your creditors can demonstrate to the court that you perpetrated fraud, such as taking out large cash advances before you filed bankruptcy, the court may render those charges non-dischargeable.