Charlotte Bankruptcy Lawyer Bryan W. Stone of Arnold & Smith, PLLC answers the question “Can I keep my house if I file bankruptcy?”
Most people assume that bankruptcy means a blank slate, a chance to start over fresh. While this is true with some categories of debt, it is important to note that a bankruptcy will not wipe away everything. Under the Bankruptcy Code, there are some categories of debt that are exempt form discharge, know as Section 523 exceptions. These exceptions apply to individuals filing Chapters 7, 11, 12 and, with some caveats, Chapter 13 bankruptcies. To find out more about the debts that you may never be able to fully escape, keep reading.
Back taxes may be burdensome, but they aren’t dischargeable, at least not for several years. The general rule is that any income taxes less than three year olds are not dischargeable in a bankruptcy. Income taxes more than three years old may be discharged, but only if the debtor has filed a tax return and an offer in compromise is not pending. Fraudulent tax returns or those debts that relate to tax evasion are never dischargeable, no matter how old.
Money obtained through fraud
This includes all money that was obtained under false pretenses, such as misrepresentations or outright fraud. An example of this would be securing a loan by lying on your application about your job status or income. Another would be taking out large loans or cash advances immediately prior to filing bankruptcy, something that is deemed fraudulent and can result in non-dischargeable debts.
Alimony and child support
Alimony or spousal maintenance owed to a former spouse is not dischargeable in bankruptcy. Same goes with child support. Courts are clear they don’t want people using bankruptcy to get out from under debts owed for the support of family members, something that could then lead to financial trouble for the recipients.
Willful and malicious injury/DUI-related injury claims
Any injury that results from something the debtor did purposefully or knowing that it would likely result in such an injury is non-dischargeable. Same goes with personal injury or wrongful death claims relating to the debtor’s operation of a motor vehicle while drunk.
Bizarrely, condominium fees and other homeowner’s association dues will survive bankruptcy and cannot be discharged. This isn’t an especially critical aspect of most bankruptcies, but should be mentioned if the debtor happens to reside in a condo and owes back fees.
It’s all too common that people go to school and emerge with mountains of debt they may never be able to repay. Sadly, student loans are not usually dischargeable in a bankruptcy. In some very rare cases a person can petition claiming that the loans pose an undue hardship and courts may release the person, but this is exceptionally rare.
If you find yourself needing the services of a Charlotte, North Carolina bankruptcy attorney, please call the skilled lawyers at Arnold & Smith, PLLC find additional resources here. As professionals who are experienced at handling all kinds of bankruptcy matters, our attorneys will provide you with the best advice for your particular situation.
About the Author
Bryan Stone is a Partner with Arnold & Smith, PLLC, where he focuses his practice on all aspects of bankruptcy, including: Chapter 7, Chapter 11, Chapter 13, home loan modifications and landlord-tenant issues.
A native of Macon, Georgia, Mr. Stone attended the University of Georgia, where he earned a BBA in Banking and Finance, and Wake Forest University School of Law, where he obtained his law degree.
Following law school, Mr. Stone relocated to Charlotte, where he currently serves as Chair of “Bravo!” – a young professionals organization associated with Opera Carolina – and founded the University of Georgia Alumni Association of Charlotte.
In his spare time, Mr. Stone enjoys perfecting his barbeque skills for the annual “Q-City BBQ Championship” and playing softball in the Mecklenburg County Bar softball league.
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