Debts Exempted From Bankruptcy

Filed Under Bankruptcy | Leave a Comment

Whenever considering filing for bankruptcy, there will be certain assets exempt from bankruptcy. In addition to this fact, there are also some debts exempted as well. There are certain debts that you have accumulated that will still have to be paid, whether you file bankruptcy or not.

For example, one of the debts exempt from bankruptcy is child support. If you have been ordered to pay child support payments, or maintenance, by a court order, filing bankruptcy will not alleviate these debts. Child support debts will not be reduced or eliminated, whether or not you file Chapter 7 or Chapter 13 bankruptcy. Many people try to avoid paying these obligations, but child support is considered to be one of the debts exempt from bankruptcy.

If you find you have any IRS liens against you, those will be exempt from bankruptcy law. An IRS audit is never pleasant, and in some cases, the IRS may put a lien on your home or garnish your wages. Although IRS liens and garnishments can end up costing someone quite a bit of money, IRS liens are debts exempt from bankruptcy.

If you have been the recipient of a lawsuit and the court has awarded another individual or creditor a certain amount of money from the lawsuit, this will be another example of debts exempt from bankruptcy. Such judgments cannot be discharged, and for this reason, those who have not paid their bills in quite a while, should find out if there are any judgments outstanding awarded by the court against them prior to filing bankruptcy. Creditors sometimes sue an individual for not paying their bills, however this is usually a time consuming measure and it takes quite a while for a judgment to actually be ordered by the court. Furthermore, the individual is supposed to be notified of any pending litigation. If a creditor does manage to get a judgment against you prior to your filing bankruptcy, the judgment will be considered a debt exempt from bankruptcy. For this reason, those who are considering filing bankruptcy must do so in a timely manner.

One final debt exempt from bankruptcy are government loans. For example, if you have a student loan funded by the government, you will not be able to have this discharged by filing bankruptcy.

The bottom line is to examine your debt to discover which bills are considered debt exempt from bankruptcy prior to filing so you will not experience any surprises along the way.

Related Financial Resources

Share and Enjoy:

Powered By WP Footer

What Assets Are Exempt From Bankruptcy? When facing potential bankruptcy, one question often asked is...
When Chapter 13 Bankruptcy Makes Sense When considering the debt load and weighing out what...
Rebuilding Credit After Bankruptcy When debt begins to overwhelm, many people often fall victim...
Some Of The Advantages Of Bankruptcy If you are finding yourself buried under a mountain of...
Bankruptcy: Chapter 7? The two most common forms of bankruptcy are known as...