What debts are not discharged by filing bankruptcy?

In a Chapter 7 case, the most common type of personal bankruptcy, the court does not allow a person to keep their assets, but most of the exemptions allowed by state and federal laws are large enough to cover a guaranteed debt, like a mortgage Auto loan.

However, if the value of the item is greater than the exemption, the debtor may have to sell the property to pay its debt, since the court will not liquidate it in bankruptcy.

The United States Bankruptcy Court provides maximum protection for child support or alimony owed to a spouse, former spouse, children of the debtor or a government agency. The protection of the court also extends to the debts that resulted from a divorce or separation agreement and the ex-spouse does not need to file a complaint to prevent this type of debt being written off.

Student loans, whether issued by the government, a nonprofit lender or an educational loan fund, can not be written off in bankruptcy unless the debtor can prove that the additional payments would create an unusual hardship for them.

If the debtor has made recent purchases of non-essential items or cash advances purchased on a credit card, you should not expect to see those charges included in the bankruptcy. Consumer debts owed for luxury goods or services that cost more than $ 500 and are incurred within 90 days after the filing of the bankruptcy will not be written off. For cash advances, the limits are $ 750 earned within 70 days of submission.

Property taxes are generally not written off for bankruptcy, but some federal taxes may be provided they meet specific conditions. The federal income tax debt can be canceled if it is more than three years old, it was filed more than two years before the presentation and the debtor did not file a fraudulent tax return or try to avoid paying taxes.

Debts or fines owed as a result of delinquent or illegal conduct will not be eliminated through bankruptcy. These include fines not paid for personal injury or death caused if the debtor was charged with driving under the influence and traffic fines, as well as criminal restitution ordered by the court or any debt that arose from fraud.