Before filing for bankruptcy, it’s best to consult with a bankruptcy lawyer to gain a better understanding of the proceedings. Many petitioners mistakenly assume all debts will be discharged or wiped out when filing under Chapter 7 or 13 of the bankruptcy code; however, that’s not necessarily the case. Below are some obligations that won’t qualify for cancellation.

7 Non-Dischargeable Debts In Bankruptcy

1. Child Support & Alimony

Obligations arising from domestic support, including alimony and child support, do not qualify for discharge in bankruptcy. These are your responsibilities, and bankruptcy proceedings are not a valid reason to stop fulfilling them. Non-support debts arising from divorce or settlement can be discharged in Chapter 13, but not in Chapter 7.

2. Student Loans

In many cases, student loans are non-dischargeable, especially if you file for bankruptcy following graduation or stopped schooling. There are few exceptions to this scenario, for example, instances of undue financial distress; however, you have to meet the criteria set by the court.

3. Tax Debts & Government Penalties

Not all tax obligations can qualify for discharge, even if they’re already a few years old. If you have unpaid withholding taxes from your employees, customs fees, Social Security-related penalties and charges, and fines owed to government agencies, you must settle them, even in bankruptcy.

4. Dues From Criminal & Malicious Acts

Outstanding liabilities arising from fraudulent, malicious, and criminal activities are not dischargeable, no matter the chapter filing. Debts due to a personal injury case, obligations from criminal restitution, and court fines must be paid because of how they were incurred.

5. Secured Loans

Filing for bankruptcy does not prevent creditors from repossessing your property due to missed payments. Instead, consult your bankruptcy lawyer if you plan to keep your home or car. These loans may require restructuring for a more reasonable repayment plan.

6. Recent Credit Card Charges & Cash Advances

Creditors can object to the cancellation of debts, primarily if incurred with malicious intent. Credit card purchases exceeding $725 for luxury goods and made within 90 days of the bankruptcy filing are presumed fraudulent and, therefore, non-dischargeable. The same goes for cash advances amounting to $1,000 obtained within 70 days of a bankruptcy petition—there is an apparent lack of intent to repay these obligations.

7. Unscheduled Debts

Unscheduled debts are those not listed in the bankruptcy petition and, in most cases, won’t qualify for cancellation. These can be discharged if creditors knew of the filing but took no action.

Even with non-dischargeable debts, filing for bankruptcy can benefit you in the long run. Talk to a bankruptcy lawyer at Swartz Law Office in Batavia, OH, to better understand your options for debt relief. They also provide assistance on custody, divorce, and estate planning that may have an impact on your Chapter 7 or Chapter 13 filing. Call their office at (513) 732-0900 or visit them online.