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What types of debt are not discharged in bankruptcy?

It can take years before a person realizes he or she is deep in debt. For others, a sudden event might cause a surge of debt that is instantly noticeable.

Debt also takes many different forms. Some Colorado residents might accumulate large credit card bills, while others find themselves with high medical bills or tax debt.

No matter how the debt arrives or what form it takes, however, most individuals want the same thing: to be debt free. While filing for bankruptcy can eliminate a person's debt, the types and amount of debt a person has becomes important in the bankruptcy process.

Perhaps most importantly, there are certain types of debt that may not be discharged in bankruptcy. These exemptions from discharge are set by Congress based on public policy.

The most common types of debt that are not discharged in bankruptcy include tax debt and debts to the government. Spousal support or child support debt is also typically excluded from a bankruptcy discharge. In addition, if a person has debt related to a willful or malicious injury they caused on another person, that debt may not be discharged, as well as debt from injuries to another person caused by the debtor's drunken driving.

Even within the above categories, however, there may be different rules at play that can affect the discharge. For instance, debts for willful or malicious injury to property may be discharged in Chapter 13 bankruptcy, while they may not be discharged in a Chapter 7 bankruptcy. Accordingly, each category of debt should be considered on its own within the context of the debtor's individual situation to determine what is likely to occur.

Source: United States Bankruptcy Court, "Bankruptcy Basics," accessed on Sept. 5, 2014

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