Why Some Debts Are Not Discharged in Bankruptcy
In most bankruptcy cases, the process goes according to plan and the debtor, if eligible, receives a discharge of the debts they were expecting to have discharged. Yet in some bankruptcy cases, the debtor may have only some of their debts discharged, and in limited cases, a bankruptcy case may be dismissed without a discharge altogether. What would have to happen in a bankruptcy case for the court to deny a discharge of certain debts, or for the court to dismiss the case? There are a number of reasons why a particular debt might not be discharged in a bankruptcy case, and specific reasons that a bankruptcy case may be dismissed without a discharge. Our experienced West Palm Beach bankruptcy lawyers can provide you with more information.
Understand Types of Bankruptcy and Discharge Eligibility
Before we explain why a bankruptcy case might not involve the discharge of debts when a debtor was anticipating a discharge, it is essential to have a clear understanding of whether a discharge was possible given the type of bankruptcy filing and the type of debt.
Only individuals (not businesses) receive discharges in Chapter 7 bankruptcy cases. Even in reorganization bankruptcy cases, whether or not any debts are discharged depends on the debtor’s specific financial circumstances and whether all debts must be repaid as part of the bankruptcy case. In addition, some debts are considered exceptions to discharge under the bankruptcy code, which means they are never dischargeable in a bankruptcy case. Examples include family support debt and certain types of tax debt.
Reasons a Bankruptcy Case Can Be Dismissed Without a Discharge
Assuming that your debts were actually eligible for discharge but the court ultimately dismissed your bankruptcy case without discharging your debt, what might have happened? There are a handful of reasons that a court might dismiss a bankruptcy case without discharging eligible debts. Those reasons typically include, for example:
- Concerns about bankruptcy fraud;
- Errors in bankruptcy documents; and/or
- Failure to complete one or more bankruptcy requirements (such as the debtor education course).
Depending on the issue, it may be possible to get your bankruptcy case back on track with assistance from a bankruptcy attorney. And if you have filed for a type of bankruptcy that is not likely to result in the discharge you were expecting, you should discuss the details and your options with a bankruptcy lawyer who can help.
Contact Our West Palm Beach Bankruptcy Attorneys Today
If you have any questions about the dischargeability of personal or business debts, it is crucial to know whether you can expect those debts to be discharged prior to your bankruptcy filing. While many types of debts are dischargeable for individuals in both liquidation and reorganization bankruptcies, and for businesses in Chapter 11 and other reorganization bankruptcy cases, there are various reasons that certain debts may not be discharged. To seek legal advice about your personal or business bankruptcy, you should get in touch with an experienced West Palm Beach bankruptcy lawyer at Kelley, Kaplan & Eller as soon as possible. Contact our firm today to learn more about how we can assist you.
Source:
law.cornell.edu/uscode/text/11
