A Chapter 7 bankruptcy will discharge a significant amount of debt. Once, before the reforms were put into place in 2005, the amount of debt eligible for discharge was much greater than now. Particular debts are now not dischargeable under a Chapter 7 plan and may remain even after the FL bankruptcy court has discharged other financial obligations.
Generally, the debts that will not be discharged in their totality by a Chapter 7 plan include:
• Child support and alimony due (including past due amounts)
• Student loans (unless the court has established that repayment of the debt will cause “undue hardship” to the debtor and his or her dependents.
• Debts created from being found guilty of driving while intoxicated or damages incurred due to an accident caused by drunk driving.
• Debts not named in the bankruptcy petition.
• Debts owed creditors not listed in the FL bankruptcy petition.
• Court fees owed.
• Federal, state and local taxes.
• Restitution, fines and penalties assessed by the government.
• Debts not dischargeable from a previous bankruptcy due to debtor fraud.
During the bankruptcy process, creditors are given the opportunity to challenge your right to discharge some debts owed to them in FL bankruptcy court. The court could allow these disputes if the creditors can prove the debts fall in one of the following general categories:
• The debt created by willful and malicious actions(such as assaulting someone)
• The debt was created by fraud. These categories include balances on credit cards charged up within 90 days of the court filing for lavish goods and services.
• Cash advances of more than $750 made from accounts within 70 days of filing the bankruptcy petition.
• Debts from a divorce settlement or other court decree which the debtor is able to pay and nonpayment injures the recipient more than it benefits the debtor.
• Debts created from embezzlement, theft or a violation of some trust, or fiduciary duty.
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