Can Filing For Bankruptcy Erase All Of Your Debts?
When filing for either Chapter 7 or Chapter 13 bankruptcy, the aim is to get debts discharged. This means that you will no longer have to pay them, which may include credit cards and medical bills. Bankruptcy eases much of your financial burden, especially if you’re suffering from overwhelming liabilities.
However, there are debts that are non-dischargeable and will need to be paid. While bankruptcy provides you with the relief you need from liabilities, you might be surprised to know some of them don’t count. Learn what these debts are and how a bankruptcy lawyer can assist you in getting relief from overwhelming debt.
Debts Bankruptcy Cannot Discharge
Bankruptcy seems like an easy way out when there are no other options left. What people fail to consider is that they cannot escape all forms of debt just by filing for bankruptcy. Non-dischargeable debts remain enforceable to the debtor and bankruptcy does not forgive them.
It’s important for you to take note of what these debts are before you even consider filing. With the help of a bankruptcy attorney, you’ll be able to decide clearly on your next course of action. An attorney can advise you on the debts you should list down and those that you have to plan for during the course of your bankruptcy proceedings.
Unlisted Debts When Filing
You are instructed to list all debts when you file for bankruptcy. If you fail to list a liability, then it will not be included in the proceedings and will not be erased. If you think you may have accidentally omitted a debt when filing, it is possible to file an amendment to your schedule of debts and allow the creditor notice.
Whenever you discover an omission on your end, it’s important to talk to a bankruptcy lawyer to get the assistance that you need. A bankruptcy attorney will examine your declaration carefully and consult with you about your assets or debts. That way, you can prepare for which assets you can keep or have a clear idea of how to go about your repayment scheme.
Certain Types Of Taxes
Taxes are obligations that individuals and businesses need to pay the government. Regardless of your bankruptcy, you should always pay certain taxes as they are non-dischargeable. Failing to do so may result in run-ins with the IRS, even when you’ve filed for bankruptcy.
With the help of a bankruptcy attorney, you can assess the non-dischargeable tax obligations that you have. This will also save you the hassle of dealing with tax authorities, among others.
Recent property taxes, sales taxes, taxes on trust funds, and non-punitive tax penalties less than three years at the time of filing cannot be discharged. You should examine your tax records carefully and take a look at the returns that you filed. An experienced bankruptcy attorney can help you determine which of your unpaid taxes can be discharged under each type of bankruptcy.
Child Support & Alimony
When you owe child support or alimony because you have not paid all or some of what you are supposed to pay, the consequences can be serious. The general rule is that alimony and child support debts cannot be discharged in bankruptcy.
More Non-Dischargeable Debts
There are a few more debts that you should take note of before filing for bankruptcy. If you find yourself having any of these, then you should know that they may not be erased by filing.
- Student loans, under Section 523(a)(8) of the Bankruptcy Code.
- Drunk driving-related personal injury debts, including deaths caused while driving under the influence.
- Certain credit card purchases amounting to more than $650 during the 90 days before you filed for bankruptcy.
- Debts that are obtained under false pretenses, if the creditor successfully claims.
- Debts that the filer incurred because of willful and malicious injuries to people or property.
Consult With A Seasoned Bankruptcy Lawyer
You may be worried about the debts you’ve incurred and if you can have them erased. When looking at bankruptcy as an option, be sure to talk to a bankruptcy attorney. Lincoln-Golfinch Law helps individuals and businesses navigate the often complex bankruptcy proceedings.
The firm’s bankruptcy attorneys assist in filing, whether it’s for Chapter 7 or Chapter 13. Consult with Lincoln-Goldfinch Law when you petition. Their attorneys will help you on your way with your bankruptcy case.
Summary
Filing for bankruptcy does not always discharge all your debts. You still have to settle your obligations such as some student loans, unlisted debts, taxes, child support, and alimony. For advice on which debts to list and which ones you can erase in bankruptcy, be sure to consult with a bankruptcy lawyer.
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