Westall, Gray & Connolly, P.A. |   wgcd@wgcdlaw.com |   828-254-6315

Discharge | Asheville, NC

What is a discharge?

As explained earlier, the basic purpose of bankruptcy is to obtain a discharge of your debts. However, some specific types of debts are not discharged (i.e., the bankruptcy does not relieve you of your obligation to pay). Those debts are described below.

Are any debts not discharged?


Chapter 7 Cases

  Types of Debts that May Not be Discharged Explanation
1 Unlisted Creditors  
2 Taxes Applies to certain types of taxes
3 Claims based on money obtained through fraud/false pretenses For example, you use a false financial statement to obtain credit.
4 Luxury Good Debts Must be within 90 days of the bankruptcy filing and over $650.
5 Cash Advances Must be under an open-end credit plan, made within 70 days of filing, and for more than $925.
6 Alimony, child support, and marital debts from a separation agreement  
7 Damages for personal injury Must be willful or malicious injury
8 Governmental penalties and fines Applies to certain types of penalties/fines
9 Educational Loans These may be discharged in very specific cases of prolonged and severe hardship
10 Death & Personal Injury debts If caused by unlawful operation of a vehicle while intoxicated
11 Retirement account loans Also applies to federal thrift savings accounts.
12 Debts related to violations of state/federal securities laws  
13 Debts for fraud, embezzlement, or larceny  

Chapter 13 Cases

  Types of Debts that May Not be Discharged Explanation
1 Unlisted Creditors  
2 Taxes Business taxes (withholding and sales taxes)
Taxes you owe, for which you never filed a tax return
Taxes you owe and you did file a return, but it was filed late and the time of filing was within 2 years of filing bankruptcy
Taxes you owe, for which you filed a fraudulent return
Taxes you owe, after a willful attempt to pay such taxes
3 Claims based on money obtained through fraud/false pretenses For example, you use a false financial statement to obtain credit.
4 Luxury Good Debts Must be within 90 days of the bankruptcy filing and over $650.
5 Cash Advances Must be under an open-end credit plan, made within 70 days of filing, and for more than $925.
6 Educational Loans These may be discharged in very specific cases of prolonged and severe hardship
7 Damages or restitution for personal injury Must be willful or malicious injury
8 Death & Personal Injury debts If caused by unlawful operation of a vehicle while intoxicated
9 Debts for fraud, embezzlement, or larceny  
10 Restitution or criminal fines If included in a sentence given upon conviction of a crime
11 Secured Debts If you choose to pay them under the "cure and maintain" method

Are there other reasons I may not receive a discharge?

Chapter 7

  Types of Debts that May Not be Discharged Explanation
1 Prior Bankruptcies You received a discharge in a Chapter 7 proceeding less than 8 years ago You received a discharge in a Chapter 13 proceeding less than 6 years ago
2 Hide or destroy property Must be within 1 year prior to filing OR at any time after the filing You must have transferred or hidden property with the intent to delay or defraud a creditor or the court
3 Destroy, falsify, or fail to keep books, records or documents These relate to your financial condition or your business transactions You do so within justification
4 Lie about your property, debts, or financial affairs You do so knowingly and fraudulently During the bankruptcy proceeding
5 Give or receive money for taking (or not taking) certain actions You do so knowingly and fraudulently During the bankruptcy proceeding
6 Withhold books, records, or documents from the court You do so knowingly and fraudulently During the bankruptcy proceeding
7 Failure to satisfactorily explain a loss/deficiency of assets  
8 Refusing to obey bankruptcy court orders  
9 Refusing to answer questions The question must be material
10 Failure to complete the personal financial management course after filing  
11 There are certain other pending proceedings  

Chapter 13

  Reasons You May Not Receive a Discharge Explanation
1 Prior Bankruptcies You received a discharge in a Chapter 7 proceeding less than 4 years ago You received a discharge in a Chapter 13 proceeding less than 2 years ago
2 Failure to complete the personal financial management course after filing  
3 There are certain other pending proceedings  

The lesson to be learned is that if you are open and honest with your creditors and the bankruptcy court, you will be granted your discharge.

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Westall, Gray & Connolly, P.A.

 wgcd@wgcdlaw.com
 81 Central Ave, Asheville, NC 28801
 Office - (828) 254-6315
 Fax - (828) 255-0305

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