If you’re struggling financially, Chapter 7 bankruptcy can help you eliminate certain types of debt after liquidating non-exempt assets. However, there are certain debts which cannot be discharged in Chapter 7, and these include:
– Child support;
– Criminal fines;
– Parking tickets;
– Debts due to embezzlement, fraud, or theft;
– Debts for inflicting personal injuries due to intoxicated driving;
– Debts resulting from a property settlement in a divorce;
– Debts owed to a public benefits agency such as Unemployment Compensation or the Department of Public Aid;
– Student loans (except in extremely rare circumstances).
The category of non-dischargeable “domestic support obligations” includes any support, maintenance, or alimony for a current or former spouse, child, or your child’s other parent. “Secured debts,” such as mortgages and auto loans, are not dischargeable unless the financed property (ex. a home or car) will be returned to the proper creditor.
While many types of taxes are not dischargeable, some personal income taxes may be discharged if: an individual tax return was filed for the year in question; that return was not fraudulent; and it has been at least two years since that return was filed and at least three years since those taxes were due.
If you are struggling financially and considering filing for Chapter 7 bankruptcy, you’re not alone. Contact an experienced bankruptcy attorney today for a free consultation.