Nondischargable Debts and Obligations

Assisting in Nondischargable Debts and Obligations in McHenry, Kane, & Lake Counties

Unfortunately, some debts are non-dischargeable, some are non-dischargeable in a Chapter 7 but are dischargeable in a Chapter 13, and others are only dischargeable in certain circumstances.

Child Support and Maintenance/Alimony pursuant to an order of a domestic relations court are never dischargeable.  However, a Chapter 13 Bankruptcy can be used to pay such obligations that are past due or in arrears.  These obligations are broadly defined as amounts due to a spouse, former spouse, or child of the Debtor or such child’s parent, legal guardian, responsible relative or governmental unit.  They include child support, maintenance/alimony, medical expenses, educational expenses and guardian ad litem fees.

Property Settlements pursuant to a judgment for dissolution of marriage or divorce decree are never dischargeable in a Chapter 7 Bankruptcy but may be dischargeable in a Chapter 13 Bankruptcy for less than the full amount due.

Federal and State Income Taxes are not dischargeable in a Chapter 7 Bankruptcy unless more than three years have passed since the income taxes became due and the income tax returns were filed more than two years prior to filing the bankruptcy.  A Chapter 13 Bankruptcy can be used to pay such obligations and avoid garnishments, levies, and other collection actions by the IRS and other taxing authorities.

Other Taxes such as payroll withholding taxes and sales taxes are non-dischargeable in a Chapter 7 Bankruptcy.  A Chapter 13 Bankruptcy can be used to pay such obligations and avoid garnishments, levies and other collection actions by the IRS and other taxing authorities.

Fraudulently Incurred Obligations are not dischargeable in a Chapter 7 Bankruptcy.  These obligations generally occur when the Debtor has made false statements that have induced the creditor to act adversely to its own interests.  A Chapter 13 Bankruptcy can be used to pay such obligations and avoid garnishments, levies, and other collection actions by the Creditor.

Obligations Arising from Theft or Larceny by the Debtor are non-dischargeable in a Chapter 7 Bankruptcy.  A Chapter 13 Bankruptcy can be used to pay such obligations and avoid garnishments, levies, and other collection actions by the creditor.

Obligations for Death or Personal Injury are non-dischargeable in a Chapter 7 Bankruptcy if the obligation was 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.  A Chapter 13 Bankruptcy can be used to pay such obligations and avoid garnishments, levies, and other collection actions by the Creditor.

Student Loans are non-dischargeable in all chapters of bankruptcy except in cases of undue hardship.  The burden to show undue hardship is on the Debtor and is often very difficult to prove. A Chapter 13 Bankruptcy can be used to pay such obligations and avoid garnishments, levies and other collection actions by the Creditor.

Criminal Fines and Restitution are non-dischargeable.  A Chapter 13 Bankruptcy can be used to pay such obligations and avoid garnishments, levies and other collection actions by the Creditor.

Consumer Debts Incurred for the Purchase of Luxury Goods aggregating more than $725 and obtained within the 90 days of filing a Bankruptcy Petition are non-dischargeable.

Cash Advances Aggregating more than $1,000 and obtained within 70 days of filing a Bankruptcy Petition are non-dischargeable. 

Call (815) 374-7783 today to speak with us. We offer a free case consultation and invite you to speak with us about your case.