Sacramento Bankruptcy: Are there any Debts which are Not Dischargeable During Bankruptcy?

Most all debt can be eliminated in a Chapter 7 bankruptcy; however, the law has established some limits.  Debts which cannot be eliminated are called “non-dischargeable” because they cannot be discharged even in a bankruptcy. 

1)  Student loans- Loans for educational benefit cannot be discharged in bankruptcy except because of an undue hardship.  Loans for educational benefit include loans for tuition, room and board, etc.

2)  Taxes- Taxes cannot be discharged in a Chapter 7 bankruptcy unless all four of the following conditions are met:    a)they must be income taxes (or taxes on gross receipts), b) they must be more than three years old, c) they must have been filed on time (by April 15th or with a proper extension), and d) they must be accurate (the IRS found no errors or omissions).  If taxes were filed late, they can still be discharged as long as they were filed 2 years prior to the bankruptcy.  Unless these conditions are met, taxes cannot be discharged in a bankruptcy.

3)  Marital or Divorce Debt- Debt which was incurred in a divorce decree cannot be discharged in Chapter 7.  Changes in the bankruptcy law mean that any debt in a divorce decree cannot be included in a bankruptcy filing regardless of the former spouses support or objection of the bankruptcy filing.
4)  Court Imposed Restitution:  If a court orders payment to the victims of criminal activities, the payments are not dischargeable through a bankruptcy filing.

5)  Court Fees- Debt owed to the court are not dischargeable in a Chapter 7 bankruptcy filing.

6)  Fraud or Theft- Debt incurred during the commission of fraud cannot be discharged.  Likewise, debt incurred through larceny or embezzlement.

7) Intentional Torts- Debt incurred from intentional acts to injure another person or their property cannot be discharged.  These intentional torts include assault and battery.

8)  Debts Not Previously Discharged- Debt which was not included in a previous bankruptcy are excluded if that bankruptcy was dismissed due to fraud

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