Debts That Bankruptcy Does Not Discharge
Bankruptcy does not discharge all types of debt. In both Chapter 7 and Chapter 13bankruptcy, there are certain types of debt that will not be discharged or erased. Let’sbegin by looking at debts that are not discharged in a Chapter 13 bankruptcy.A Chapter 13 discharge affects only those debts allowed by your bankruptcy plan. Anydebts not specifically addressed in your plan may remain, and you will be required to paythem in full – even after the discharge. Debts that are not usually discharged under aChapter 13 bankruptcy include: claims for child support and alimony, educational loans,drunk driving debts, criminal fines, and certain long-term obligations such as homemortgages, that extend beyond the term of the plan. An experienced bankruptcy attorneycan explain which debts are erased in your Chapter 13 bankruptcy and which debts willremain.Likewise, a Chapter 7 bankruptcy does not discharge every kind of debt. Typically,intentional acts of wrongdoing, such as fraud, are not dischargeable. Other types of debtsthat are not going to be dischargeable are debts that have a very important social orpolitical aspect to them. These debts usually include taxes, student loans, alimony,spouse support, and child support. Additionally, a Chapter 7 bankruptcy does notdischarge debts associated with a divorce or marital separation agreement (i.e. a propertydivision judgment).Taxes owed to the United States government, or any state, county, or government agencyare not typically dischargeable. However, income taxes can be discharged if all of thefollowing criteria are met:1.
The taxes are more than three years old at the time the bankruptcy was filed.2.
If your tax return was not filed on time, more than two years must have expiredsince the return was filed.3.
If there was an assessment, more than 240 days must have expired from the dateof the assessment before the bankruptcy was filed.4.
There has been no fraud.For more information about what debts will remain after your bankruptcy, consult withan experienced bankruptcy attorney.
Is My Income Too High To File Chapter 7?
If you earn a good living, you may be wondering if your income is too high to fileChapter 7. Most people considering bankruptcy should be able to file under Chapter 7.However, if your income is above the median family income in your state, you may beforced to file Chapter 13. Higher income earners must complete a “means test” thatrequires detailed information about your income and expenses. If the test shows that you
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