What Happens to “Exceptions to Discharge” in Bankruptcy?
Are you thinking about filing for personal bankruptcy? Whether you are planning to file under Chapter 7 or Chapter 13, it is critical to understand how the “exceptions to discharge” in the US Bankruptcy Code could affect your bankruptcy case. The statutory exceptions to discharge are particularly important to consider in Chapter 7 cases since the debtor will be filing in order to have debts discharged within a relatively short time frame. While the dischargeability of a debt can still impact a Chapter 13 bankruptcy case or another type of reorganization bankruptcy, it may be less significant over the years of your bankruptcy case and repayment plan.
What happens if your debts are identified as exceptions to discharge? In short, you will need to determine whether there is an exception to the “exception to discharge” such that you can have your debt discharged. Otherwise, the debt will not be dischargeable in a personal bankruptcy case.
Student Loans Debt Can Be Discharged
Educational debt, i.e., student loans, are one of the most obvious exceptions to discharge. However, you can have student loans discharged if you meet the requirements for the exception to the “exception to discharge.” If you can show that continuing to pay your student loans would impose an undue hardship, your student debt can be discharged. The process for doing this has become significantly easier and more streamlined in the last couple of years, and many debtors who file for bankruptcy are having their student loans discharged.
Certain Tax Debts Can Be Discharged
Tax debts are another exception to discharge. However, there are some circumstances in which you may be able to have personal income tax debt discharged. You will need to meet a series of requirements, including several key timing requirements. You should discuss the details of your personal income tax debt with your bankruptcy lawyer to determine whether or not it can be discharged in a consumer bankruptcy case in South Florida.
Family Support Debt is Never Dischargeable
Unlike student loan debt and certain types of tax debt, there are no exceptions when it comes to trying to have family support debt discharged. This type of debt simply cannot be discharged regardless of the circumstances. If you are filing for reorganization bankruptcy under Chapter 13 or Chapter 11, however, you can include family support debt in your repayment plan; all of it will need to be repaid since it is a priority debt, but it can be repaid over time through the repayment plan.
Contact Our West Palm Beach Bankruptcy Attorneys Today
Are you currently struggling with a form of debt that is classified as an exception to discharge in the Bankruptcy Code? If so, and especially if you have student loan debt, you should get in touch with a bankruptcy attorney to find out about an exception to the “exception to discharge.” As we noted above, it has become significantly easier to meet the requirement to have student loans discharged, and an experienced West Palm Beach bankruptcy lawyer at Kelley, Fulton, Kaplan & Eller can help. Contact our firm today to have your bankruptcy questions answered and to find out more about discharge eligibility for your debt.
Source:
law.cornell.edu/uscode/text/11/523
