What Can I Do About My Non-Dischargeable Debts?

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Unless you’ve been living under a rock, you know that there are some debts that bankruptcy just can’t eliminate. Probably the most well-known “non-dischargeable” debt is child-support. If you’ve been court ordered to pay support funds to the mother or father of your child(ren) and have fallen behind on payments, filing for bankruptcy will not erase that debt.

The same goes for any court-ordered alimony. Rest assured that many people have attempted to find a loophole out of paying their child-support and/or alimony. Let it be said here that we believe in parents paying the child-support they have been ordered to pay.  At the dissolution of your marriage or relationship with your child’s partner, you didn’t dissolve your role as parent. Therein, you are still responsible for the financial support of your offspring.

However, there are cases wherein the “alimony” (spousal support) you’re paying isn’t officially court-ordered alimony at all. You may have fallen behind on helping your ex-spouse in making his/her car payment or house payment – both of which are considered to be property debts rather than alimony arrears. If this is the case, you may be able to discharge those debts in a bankruptcy case.

If you owe back payments on your child-support payments and/or court-ordered alimony payments, it is possible to reorganize your payments with a Chapter 13 bankruptcy. This will allow you to space out payments so they fit into your budget plan. Keep in mind that a Chapter 13 bankruptcy does not eliminate your debts, but rather has the goal of rearranging the money you owe to various people so that you can make the payments without going under.

Another debt that is very hard to escape is student loan debt. Millions of Americans are struggling to make ends meet and cannot manage to repay their student loans, even while working full time jobs. The cost of a college education is quite high – and when loans are taken out (and often times defaulted on multiple times), the interest adds significantly to the amount due. You can discharge your student loans if you can prove past a shadow of a doubt that you will never be able to repay them. To do so is extremely difficult, and those who succeed have almost always been permanently and significantly disabled.

If you have unpaid income tax debt, believe it or not, it is possible to have it completely discharged in a Chapter 7 bankruptcy, including interest and late or penalty fees that may have accrued over the years.

The bottom line is that there are several types of debt that are difficult to wipe out with a basic Chapter 7 bankruptcy, but some of them can be reorganized through a Chapter 13 bankruptcy. If you are unsure whether your debt(s) are eligible for a Chapter 7 or 13 discharge, speak to a bankruptcy attorney to learn more about the different types of debt, and where your particular debt falls.

Image credit: Steven Depolo
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2 Responses to What Can I Do About My Non-Dischargeable Debts?

  1. Pingback: How Can I Afford to Send My Child to College? | Veitengruber Law

  2. Pingback: Is Unpaid College Tuition Dischargeable in Bankruptcy? | Veitengruber Law

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