What Debts Are Exempt From Bankruptcy
When filing for bankruptcy the aim of most people is to sort out their financial situation.
They may have made a number of mistakes with their money in the past that has lead to large debts or maybe they have just been irresponsible.
Whatever the reasons, the hope is that they can start a fresh by either clearing all the debts or by getting a payment plan in place to address the debt.
However it is important to know what you are doing as some debts are exempt from any bankruptcy process.
This article will address what debts are exempt from bankruptcy.
All child support and maintenance payments, be they current payments or outstanding debt are exempt from any bankruptcy proceeding if they were set by a court.
This means if you have any payments for child support the courts cannot help you.
You will have to find the money for these payments no matter what.
This includes chapter 7 and 13 bankruptcy too.
Generally any money that you owe the government is exempt also.
This could be a loan or any back taxes that may be owed by you.
For instance, many student loans that are run by the government will need to be paid back in full regardless of your financial situation.
Any moneys that you owe the IRS will also need to be paid.
Another debt that cannot be cleared through bankruptcy is any court orders that were passed down to you before the process was initiated.
This means that anybody that has taken you to court over an outstanding debt and had the ruling against you to pay a certain sum will have to receive the agreed amount in full.
These are some of the debts that cannot be cleared should you decide to file for bankruptcy.
If you decide to go down this route it is important that you do a proper audit of your financial situation.
If you have debts that fit into any of these categories then you should think again about filing.
It could end with you still owing a large amount of money and your reputation and credit rating may have been tarnished.
They may have made a number of mistakes with their money in the past that has lead to large debts or maybe they have just been irresponsible.
Whatever the reasons, the hope is that they can start a fresh by either clearing all the debts or by getting a payment plan in place to address the debt.
However it is important to know what you are doing as some debts are exempt from any bankruptcy process.
This article will address what debts are exempt from bankruptcy.
All child support and maintenance payments, be they current payments or outstanding debt are exempt from any bankruptcy proceeding if they were set by a court.
This means if you have any payments for child support the courts cannot help you.
You will have to find the money for these payments no matter what.
This includes chapter 7 and 13 bankruptcy too.
Generally any money that you owe the government is exempt also.
This could be a loan or any back taxes that may be owed by you.
For instance, many student loans that are run by the government will need to be paid back in full regardless of your financial situation.
Any moneys that you owe the IRS will also need to be paid.
Another debt that cannot be cleared through bankruptcy is any court orders that were passed down to you before the process was initiated.
This means that anybody that has taken you to court over an outstanding debt and had the ruling against you to pay a certain sum will have to receive the agreed amount in full.
These are some of the debts that cannot be cleared should you decide to file for bankruptcy.
If you decide to go down this route it is important that you do a proper audit of your financial situation.
If you have debts that fit into any of these categories then you should think again about filing.
It could end with you still owing a large amount of money and your reputation and credit rating may have been tarnished.
