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Loans, medical debt and credit card debt are generally all able to be discharged through bankruptcy. Tax debt, alimony, spousal or child support and student loans are all typically ineligible for ...
There are 19 categories of debt excepted from discharge under Chapter 7, 11, and 12. Several types of debts are generally not dischargeable in bankruptcy under §523. These include certain taxes, such as payroll taxes, student loans, child support, alimony, and debts arising from fraud or intentional wrongdoing.
However, the debtor is not granted a discharge if guilty of certain types of inappropriate behavior (e.g., concealing records relating to financial condition) and certain debts (e.g., spousal and child support and most student loans). Some taxes are not discharged even though the debtor is generally discharged from debt.
Common exceptions to discharge include child support, income taxes less than three years old, property taxes, student loans (unless the debtor prevails in a difficult-to-win adversary proceeding brought to determine the dischargeability of the student loan), and fines and restitution imposed by a court for any crimes committed by the debtor.
Key takeaways. Chapter 7 bankruptcy involves discharging debt through liquidation. Chapter 13 bankruptcy focuses on reorganizing debt through a repayment plan that typically lasts three to five years.
Chapter 13 bankruptcy allows people with regular income to repay debts over time, protecting assets and recovering financial stability. To qualify, individuals must meet income and debt limits and ...
The $80,000 portion of the debt is treated as a secured claim. Assuming a discharge is granted and none of the $20,000 deficiency is paid (e.g., due to insufficiency of funds), the $20,000 deficiency—the debtor's personal liability—is discharged (assuming the debt is not non-dischargeable under another Bankruptcy Code provision).
The goal of declaring bankruptcy varies, but usually involves the dissolution of burdensome unsecured debt (as in Chapter 7 bankruptcy) or debt restructuring or repayment (as in Chapter 11 or ...