What Debts can a debtor discharge in Chapter 7 bankruptcy filing?
A recent article in the American Bar Association Journal discussed a disbarred attorney who attempted to file chapter 7 bankruptcy to discharge the debts he owed to the State Bar Association for restitution to clients.
The article and the decision can be found at
In that case, the Bankruptcy Judge held that the disbarred lawyer's restitution obligations were fines, penalties, or forfeitures payable to and for the benefit of a government unit and non dischargeable under section § 523(a)(7) of the Bankruptcy Code.
What debts are dischargeable in chapter 7 bankruptcy?
Clients and attorneys representing debtors often ask us this question.
As many readers know Bankruptcy is a code-oriented area of the law and the sections pertaining to a debtor's discharge are 523 and 727 of the Bankruptcy Code. Similarly to the analysis in the disbarred attorney case discussed above, an experienced bankruptcy attorney needs to understand the facts regarding a debt and how that debt would be characterized or treated under Section 523 and 727 of the Bankruptcy Code.
What types of debts are generally dischargeable?
Business and consumer loans, guaranties and good guy guaranties, credit card debt, medical bills, store purchases, phone bills, mortgage debt and car loans (providing that the debtor surrenders the collateral securing those loans)
What debts generally are non dischargeable?
Recent taxes, trust fund taxes such as sales tax, alimony or child support, fines or penalties owed to a government agency, injury caused from drunk driving or driving while under the influence of drugs
Anyone with questions about which debts are dischargeable in chapter 7 bankruptcy should contact Jim Shenwick 212 541 6224 jshenwick@gmail.com
No comments:
Post a Comment