Bankruptcy discharge is a legal process in which the court releases a debtor from personal liability for specific types of debt. Following a bankruptcy discharge, the debtor is no longer obligated to pay back his or her discharged debt. Specific debts that can be discharged vary under each chapter of the Bankruptcy Code, so it’s important for a debtor to consult with an experienced Schaumburg bankruptcy lawyer about his or her specific case. In the meantime, here’s a look at some of the debts that are not discharged during bankruptcy.
If the language of section 523(a) applies to certain debt, then that type of debt is automatically excluded from discharge. The most common types of non-dischargeable debt include tax claims and debts the debtor fails to set forth on the lists he or she must file with the court. Additionally, debts owed to the government for fines and penalties as well as government-funded education loans are almost always non-dischargeable.
Certain types of debt aren’t dischargeable due to public policy reasons. For example, any debt someone accrues for personal injury he or she caused while driving a motor vehicle intoxicated is typically non-dischargeable. Similarly, debts for willful and malicious injuries to person or property aren’t likely to be discharged. A debtor will also be required to pay debts for spousal or child support obligations following bankruptcy. Debt obligations that aren’t automatically exempt from discharge can become exempt if a creditor successfully petitions the court for the exemption.
Debtors in Chapter 13 petitions have a slightly broader range of dischargeable debt available. For example, a Chapter 13 petitioner may be able to discharge debt for willful and malicious injury to property and debts arising out of property settlements in divorce or separation proceedings. However, a Chapter 13 debtor usually only receives this discharge after completing his or her court-approved repayment plan.
Established in 1990, Cutler & Associates, Ltd. provides the necessary guidance to help people rebuild their lives following severe debt. We provide compassionate, confidential legal counsel from the moment you call.