Bankruptcy relief under federal bankruptcy code can often bring about great relief to those that file. Starting over with a clean slate without having to worry about debt collectors, harassing phones calls, or embarrassing garnishments, is a great thing for many people. However great this may be, the truth of the matter is that not all debt can be discharged under the bankruptcy code.

Don’t let this worry you, as in most cases the vast majority of debt is wiped away. It is just under very particular circumstances that some special debt is not dischargeable. When it comes to debts that are not dischargeable, there are 2 categories; Debts which are never dischargeable and those that are dischargeable with a showing of specific circumstances.

Debt that is never dischargeable under the bankruptcy code includes debt that is for:

1. Specific customs fees and duties owed.

2. Money, property, services, or an extension, renewal, or refinancing of credit, to the extent obtained by false pretenses, fraud, or made with the intent to deceive.

a. Luxury goods or services costing more than $500 within 90 days of the petition for
relief and cash advances for an aggregate amount of more than $750 taken within
70 days of the petition being filed are presumed to be non-dischargeable debts.

3. Fraud or defalcation while acting in a fiduciary capacity, embezzlement, or larceny.

4. Domestic support obligations such as child support or alimony.

5. Willful and malicious injury by the debtor to another entity or to the property of another entity.

6. Government imposed fines and penalties.

7. Death or personal injury caused by the debtor’s operation of a motor vehicle, vessel, or aircraft if such operation was unlawful because the debtor was intoxicated from using alcohol, a drug, or another substance.

8. Prior obligations that was or could have been listed or scheduled by the debtor in a prior case concerning the debtor under this title or under the Bankruptcy Act in which the debtor waived discharge, or was denied a discharge.

9. A fee imposed on a prisoner by any court for the filing of a case, motion, complaint, or appeal, or for other costs and expenses assessed with respect to such filing, regardless of an assertion of poverty by the debtor.

10. Fiduciary fraud such as embezzlement or larceny.

11. Violation of any of the Federal securities laws.

12. HOA fees incurred after the order for relief

Now here are the debts that are not impossible to discharge, but are not easily discharged:

1. Student loans, unless undue hardship can be shown; this is rarely successful and unless prevailing and unusual circumstances are proven, do not expect student loans to be discharged with a bankruptcy.

2. Income taxes that are not at least 3 years old, were not filed, or were made under false pretenses or fraud. If the taxes are at least 3 years old, were filed, and were not fraudulent they can be included in your bankruptcy case and will discharged.

While the above list is not exhaustive, it covers most of the debt that is not dischargeable under the bankruptcy code. To see the actual section of the bankruptcy code that covers non-dischargeable debt, you can view the U.S. code at: 11 U.S. Code,§ 523 https://www.law.cornell.edu/uscode/text/11/523

When considering bankruptcy, it is important to talk to an experienced attorney, such as those at The Mitten Law Firm, to help determine whether or not the debt in question is going to be discharged under a bankruptcy cause petition. Contact us to set up your free chapter 7 consultation today.