Debts That Cannot Be Discharged

As a general proposition of law. all debts may be eliminated through discharge unless specifically excepted by statute. The particular Code section that delineates nondischargeable debts in Chapter 7 cases use three broad categorical prohibitions, as well as a number of other particular exceptions. Debts that cannot be discharged survive Chapter 7 as if untouched, and remain due, payable, and subject the debtor to the pains of court collection.

Few Exception to Chapter 7 Bankruptcy Non-dischargeability Rules

Liability for taxes must be paid in all circumstances, unless the exception itself is subject to a narrowly focused exception. Similarly, fines levied by governmental authorities (federal, state, county, city and taxing districts) cannot be discharged. Examples include convictions for fraud, deception and embezzlement, and the related fines, restitution and penalties resulting from a criminal conviction. A hybrid category of exceptions covers debts created by operation of law, including statutory liens, tort liability, and restitution for damages and injuries caused while under the influence of drugs or alcohol. Exculpation of civil liability for negligence through appeal may convert nondischargeble debts in to dischargeable items.