What Debts Can Be Discharged in Bankruptcy?
The Bankruptcy Code contains the rules and regulations for bankruptcy filing and processes. After you file your petition, the court can either approve your case or dismiss it before giving you the discharge. If your case is approved, you receive the discharge for all of your debts that can be dissolved through bankruptcy.
Bankruptcy and Debts
When you file your petition for bankruptcy, you must include a list with all of your liabilities. However, not all liabilities are dischargeable under a bankrupcty case. Non-dischargeable liabilities are ones the court cannot discharge, and you must pay these whether your case is accepted or not. Many debts, like credit card debt and short-term loans, are actually dischargeable under a bankruptcy filing. In a Chapter 7 filing, dischargeable debts are eliminated, and you no longer need to pay them. In a Chapter 13 filing, you create a repayment plan in which you pay off all or part of your dischargeable liabilities during a commitment period, which can be three or five years.
Non-Dischargeable Debts
There are fewer non-dischargeable liabilities than dischargeable ones. For this reason, the Bankruptcy Code provides a list of non-dischargable liabilities. Congress has made some liabilities non-dischargeable due to their very nature, or the fact that they have been incurred due to improper behavior, like a fine for driving drunk. The definition of a dischargeable liability varies a little from chapter to chapter, and many of these are the same for all chapters.
Chapter 7 Debts
Under a Chapter 7 filing, most types of liabilities can be discharged. Some things that cannot be discharged are any taxes you owe (regardless of whether to local, state, or federal government), unpaid alimony or child support, liabilities resulting from injuries you have caused to another person due to some reckless action such as driving while intoxicated, or certain government-guaranteed loans you still owe, such as some student loans.
Chapter 13 Debts
A Chapter 13 case has more types of liabilities that can be discharged than a Chapter 7 case does, such as debts for willful and malicious injury to property, liabilities incurred to pay non-dischargeable tax obligations, and liabilities arising from property settlements in divorce or separation proceedings. All other non-dischargeable items in a Chapter 7 case are also non-dischargeable in Chapter 13.
Debts Not Automatically Categorized
Some items are not automatically categorized as dischargeable or non-dischargeable, such as debts for fraud or maliciousness included in the Bankrupcty Code Section 523(a)(2), (4) and (6). In these cases, the creditor must ask the court not to discharge these liabilities. If the court does not approve the creditor's petition, these liabilities will be discharged.
Bankruptcy and Debts
When you file your petition for bankruptcy, you must include a list with all of your liabilities. However, not all liabilities are dischargeable under a bankrupcty case. Non-dischargeable liabilities are ones the court cannot discharge, and you must pay these whether your case is accepted or not. Many debts, like credit card debt and short-term loans, are actually dischargeable under a bankruptcy filing. In a Chapter 7 filing, dischargeable debts are eliminated, and you no longer need to pay them. In a Chapter 13 filing, you create a repayment plan in which you pay off all or part of your dischargeable liabilities during a commitment period, which can be three or five years.
Non-Dischargeable Debts
There are fewer non-dischargeable liabilities than dischargeable ones. For this reason, the Bankruptcy Code provides a list of non-dischargable liabilities. Congress has made some liabilities non-dischargeable due to their very nature, or the fact that they have been incurred due to improper behavior, like a fine for driving drunk. The definition of a dischargeable liability varies a little from chapter to chapter, and many of these are the same for all chapters.
Chapter 7 Debts
Under a Chapter 7 filing, most types of liabilities can be discharged. Some things that cannot be discharged are any taxes you owe (regardless of whether to local, state, or federal government), unpaid alimony or child support, liabilities resulting from injuries you have caused to another person due to some reckless action such as driving while intoxicated, or certain government-guaranteed loans you still owe, such as some student loans.
Chapter 13 Debts
A Chapter 13 case has more types of liabilities that can be discharged than a Chapter 7 case does, such as debts for willful and malicious injury to property, liabilities incurred to pay non-dischargeable tax obligations, and liabilities arising from property settlements in divorce or separation proceedings. All other non-dischargeable items in a Chapter 7 case are also non-dischargeable in Chapter 13.
Debts Not Automatically Categorized
Some items are not automatically categorized as dischargeable or non-dischargeable, such as debts for fraud or maliciousness included in the Bankrupcty Code Section 523(a)(2), (4) and (6). In these cases, the creditor must ask the court not to discharge these liabilities. If the court does not approve the creditor's petition, these liabilities will be discharged.
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