Some Debts Are Not Discharged Through Bankruptcy
There is a mistaken belief by some that the bankruptcy process will clear away all debts. This is not the case. In fact, there is a long list of debts that are not discharged through bankruptcy and must still be paid on time. Any debts you have from this list will be taken into account when determining what, if anything, is paid to creditors during the bankruptcy process.
The list on debts that cannot be discharged include:
- Taxes – the tax man always gets his pound of flesh so any taxes owed to local, state or federal authorities must be paid
- Fines – legally imposed fines must be paid according to the terms of the fines.
- Fraud – credit obtained by fraudulent means cannot be discharged through the bankruptcy process
- Alimony – maintenance, child support and other payments that are part of a separation agreement, divorce decree or other order of a court of record must still be paid as agreed or ordered by the courts
- Compensation – court ordered payments for death or injury to another party must be paid according to any court order
Other debts, including those incurred after bankruptcy proceedings began and any debts that were not included in the original application, will also not be discharged.
A common misconception is that bankruptcy can help someone avoid child support and other family payments – this is not the case. The majority of bankruptcy cases involving individuals is based on consumer spending. These debts can be discharged depending on the total financial situation of the applicant at the time the petition is filed.
Future earnings are also factored into determining which debts can be discharged. Talk to an expert on bankruptcy before making any decisions. If the bulk of your debts are in the non-discharge area then bankruptcy may not be your best option.
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March 10th, 2012 at 10:44 am
Properties were reliquished in chpt. 7 and in 2009 we were discharged. We still receive maintenance bills, tax bills and threatening letters to pay for expenses on two properties that were included in the bankruptcy. How do we get our names off these properties.