Making the decision to file for bankruptcy protection is difficult. Sometimes debts and financial obligations become so overwhelming that filing bankruptcy is seriously considered.
The primary benefit of filing bankruptcy – Chapter 7 and Chapter 13 – is the fresh start that comes as a result of the discharge of debts. When debts are discharged, bankruptcy filers are no longer responsible for the repayment of them. In addition, creditors may not continue to take collection actions on discharged debts.
According to the United States Bankruptcy Code, some debts cannot be discharged. This means the financial responsibilities survive the bankruptcy discharge. Bankruptcy filers will be responsible for paying the non-dischargeable debts after they receive the discharge of other debts from the bankruptcy court.
In order to further understand non-dischargeable debts, there needs to be a basic understanding of bankruptcy. The most common types of bankruptcy filed by individuals are Chapter 7 and Chapter 13. In Chapter 7 bankruptcy, assets are liquidated and some debts are discharged. In Chapter 13 bankruptcy, all or parts of the debts are repaid over a period of three to five years.
As outlined by the United States Bankruptcy Code, there are several types of non-dischargeable debts in Chapter 7 and Chapter 13 bankruptcy.
Non Dischargeable Debts in Bankruptcy (Chapter 7)
- Certain taxes
- Tax liens
- Child support
- Alimony
- Domestic support obligations
- Fraudulent debts
- Debts in which filer did not include creditor on bankruptcy schedule
- Debts incurred as a result of malicious injury to another party
- Fines and penalties to government entities
- Debts for wrongful death or personal injury judgments
- Student loans
Non Dischargeable Debts in Bankruptcy (Chapter 13)
- Interest owed for debts that are not dischargeable
- Student loans
- Restitution
- Fines
- Debts obtained as a result of tax evasion
- Debts incurred through fraudulent activity
- Debts that are not included on bankruptcy forms
- Debts incurred as a result of malicious injury
- Judgments in personal injury and wrongful death suits
- Tax debt as a result of evasion
- Child support
- Alimony
- Domestic support obligations
Shaw Defense Bankruptcy Alternative
There are limitations on the amount of relief that bankruptcy can provide. For people who have debts that are listed above, filing for bankruptcy protection will not provide much of a fresh start for them.
The good news is there are alternative debt relief options available for people who find themselves with non dischargeable debts. Jed Shaw of Shaw Defense is a bankruptcy attorney who has developed a unique and ethical alternative to filing for bankruptcy protection. He can help you. For peace of mind and a fresh start, call Jed Shaw at 713-750-9038 for immediate assistance.