Can I Have My Debts Discharged if I File for Personal Bankruptcy?

For most consumers in Oak Park, Illinois, one of the major benefits of filing for personal bankruptcy is that you can be eligible to have debts discharged—either quickly in a Chapter 7 bankruptcy case or the end of a reorganization plan in a Chapter 13 bankruptcy case. For many debtors in Illinois, the bankruptcy discharge allows for a fresh financial start and the ability to stop worrying about unmanageable debt. There are also other reasons to file for personal bankruptcy, especially if you are at risk of foreclosure. Filing for Chapter 13 bankruptcy can allow you to stop a foreclosure and to get back on track with monthly mortgage payments.

Yet if you are currently considering filing for bankruptcy in order to have your debts discharged, you should know that certain types of debts are not eligible for discharge. The following should give you a sense of some of the major types of debts that are considered “non-dischargeable” under the U.S. Bankruptcy Code.

Family Support Debt
If you owe back child support or spousal maintenance, these debts will not be discharged in a bankruptcy case.

Certain Types of Tax Debt

While some types of tax debt may be eligible for discharge in a Chapter 7 or Chapter 13 bankruptcy case, most types of tax debt are not dischargeable. Generally speaking, some income tax debt may be dischargeable. However, if you owe payroll taxes or other types of taxes, you should know up front that those types of tax debt are almost never eligible for discharge. If you have income tax debt, you should seek advice from a bankruptcy lawyer.

Legal Penalties and Fines
If you are cited for certain violations of the law or owe certain legal penalties, these kinds of debts likely will not be discharged in your consumer bankruptcy case. You should work with a bankruptcy lawyer to make sure you understand whether your particular debts are dischargeable.

Money Owed From a Drunk Driving Accident
If you got behind the wheel of an automobile after having too much alcohol and caused a drunk-driving accident, you may have been sued in a personal injury or wrongful death lawsuit. If a court ordered you to pay damages to an individual or family as a result of your drunk driving, you should know that this is one type of debt that is never dischargeable through consumer bankruptcy. You will still owe this debt once the bankruptcy case is closed.

HOA Fees
While HOA fees may be dischargeable in a Chapter 13 bankruptcy case once the terms of a repayment plan have been completed over a period of three to five years, HOA fees and other similar fees (such as condominium fees) are generally not dischargeable in a Chapter 7 bankruptcy case. Accordingly, if you are planning to eradicate HOA debt in a Chapter 7 case, this may not be possible.

Contact a Bankruptcy Lawyer in Oak Park
When you have questions about consumer bankruptcy, it is essential to get in touch with an experienced Oak Park bankruptcy attorney. Do not hesitate to reach out to our firm for more information about how we can help with your bankruptcy case. Contact the Emerson Law Firm to learn more.



See Related Blog Posts:

Can a Debt Collector Take My Stimulus Payment?

Benefits of Filing for Bankruptcy



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