BankruptcyLawyerHonolulu: What debts are not discharged in bankruptcy?

by Honolulu Attorney, Brian Kawamoto

The following debts will not be discharged in your bankruptcy case. This is not a complete list of such debts not discharged in a bankruptcy, also as the amounts may be updated as the law changes. It is recommended that you review a current version of 11 USC Section 523 for any of these changes:

• Recent luxury purchases over $500 within last 90 days (cash advance for casino gambling is a luxury expense)
• Cash advances over $750 within the last 70 days
• Student loans may or may not be discharged, in most cases we find that it is difficult if not impossible to get rid of student loans
• Certain taxes*
• Government fines
• Debts incurred by actual fraud, larceny or embezzlement
• Drunk driving related debts
• Credit card or loans made to pay a non-dischargeable income tax (11 USC 523 14a)
• Alimony, Child Support and Property Settlements (if you are behind in child support you must "cure" or pay it back 100% within the life of a Chapter 13 plan, or if you file for Chapter 7 the debt is not discharged in bankruptcy)
• Traffic tickets are not discharged in a Chapter 7 under 11 USC 523a7, but it "may" be discharged in a Chapter 13 but it will depend on the court's interpretation of the nature of the crime
• Post petition homeowner association fees or dues - you will be responsible for all post petition HOA fees that arise after you file for Chapter 7 bankruptcy until such time that your real property is sold at an auction. Thus only your pre-petition HOA fees may be discharged in bankruptcy. Some foreclosures take more than a year before a home is sold so if you no longer live in your home and can afford to wait, you may want to consider waiting until after your property is sold at auction before you file for a Chapter 7 bankruptcy, especially if your homeowner fees are couple hundred dollars a month.
• Property taxes due for the last year prior to filing for bankruptcy (but if you wait till the auction or sale before youfile the new buyer or new mortgage company usually pays that off) and naturally post petition property taxes are not discharged if you are still the owner of the property
• Naturally, all "post-petition" debts (or debts incurred after the date you file your bankruptcy) are not discharged

* We have discharged income taxes in bankruptcy, but a comprehensive tax discharge analysis needs to be conducted to find out if your taxes are dischargeable, to find out more on this topic see http://www.irstaxbuster.com/

DATE OF THIS ARTICLE: March 2011

Disclaimer - It is advised that you find a bankruptcy attorney or lawyer in your state when dealing with your individual situation as the bankruptcy laws are complex and changes from time to time, also every state has different laws, ruling and court decisions as it concerns bankrupty matters. Statements made here reflects the author's viewpoint for general reading purposes only and therefore should not be relied upon or considered as a legal opinion or legal advice for your own particular factual situation. Each situation is fact specific, and it is impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue.

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