Two Distinct Classes of Non-Dischargeable Debt
In consumer bankruptcy, the term "discharge" refers to the permanent court injunction that releases you from personal liability on specified debts. However, Congress enacted 19 distinct exceptions under 11 U.S.C. § 523(a).
These non-dischargeable obligations split into two major procedural groups:
Non-Dischargeable by Law
These debts survive bankruptcy automatically without the creditor taking any legal action. Examples: child support, criminal fines, and recent income taxes.
Creditor Must Sue to Block
These debts ARE discharged UNLESS the creditor files an Adversary Proceeding lawsuit within 60 days of your meeting and proves fraud or intentional harm.
Debts Automatically Excluded from Discharge
The following obligations cannot be erased in either Chapter 7 or Chapter 13 bankruptcy under federal statute:
Domestic Support Obligations
Child support, spousal alimony, separate maintenance, and paternity obligations cannot be discharged under any chapter.
DWI / Intoxicated Driving Liabilities
Judgments or settlements arising from personal injury or death caused while operating a motor vehicle, boat, or aircraft while intoxicated.
Criminal Restitution & Fines
Governmental fines, penalties, court costs, traffic citations, and court-ordered criminal restitution to crime victims.
Recent Income & Trust Fund Taxes
Income taxes due within 3 years of filing, unfiled tax returns, late-filed returns within 2 years, and 100% of employee payroll trust taxes.
Student Loan Obligations
Federal and private educational loans, unless the filer files an adversary proceeding and satisfies the 'undue hardship' standard.
Unscheduled / Omitted Creditors
Debts intentionally omitted from your bankruptcy schedules where the creditor did not receive timely notice of your case.
Debts Subject to Creditor Objections & Lawsuits
Under 11 U.S.C. § 523(c), the debtor is discharged from these obligations unless the creditor files a timely complaint in the bankruptcy court:
Fraud & False Financial Statements
11 U.S.C. § 523(a)(2)(A)-(B)Debts incurred through false pretenses, fake loan applications, misrepresented income, or actual fraud.
90-Day Luxury Purchases & Cash Advances
11 U.S.C. § 523(a)(2)(C)Luxury goods/services over $825 within 90 days of filing, or cash advances over $1,150 taken within 70 days.
Embezzlement, Larceny & Fiduciary Breach
11 U.S.C. § 523(a)(4)Misappropriation while acting in a fiduciary capacity, direct theft, embezzlement, or corporate conversion.
Willful and Malicious Injury
11 U.S.C. § 523(a)(6)Deliberate and intentional injuries inflicted on another individual or intentionally damaged physical property.
The Chapter 13 "Super Discharge" Advantage
Chapter 13 provides a broader discharge than Chapter 7. Debts that cannot be discharged in Chapter 7 may actually be eliminated in Chapter 13 upon completion of your plan:
Non-Dischargeable Debts FAQ
Can back child support or alimony be wiped out in Texas bankruptcy?
No. Under 11 U.S.C. § 523(a)(5), Domestic Support Obligations (child support, alimony, and spousal maintenance) are strictly non-dischargeable in both Chapter 7 and Chapter 13 bankruptcy. In Chapter 13, past-due arrears must be paid in full at 100% over the 3-to-5 year repayment plan.
Can tax debts ever be discharged in bankruptcy?
Yes, under strict statutory conditions. Income taxes can be discharged in Chapter 7 or Chapter 13 if they meet the '3-Year / 2-Year / 240-Day Rule': the tax return was due at least 3 years prior to filing, the return was filed at least 2 years prior, the IRS assessed the liability at least 240 days before filing, and there was no willful tax evasion or fraudulent return.
What happens if a creditor claims I committed fraud before filing?
Debts incurred by false pretenses, false financial statements, or fraud are non-dischargeable under 11 U.S.C. § 523(a)(2). However, fraud is not automatic: the creditor must file an Adversary Proceeding (a separate federal lawsuit) within 60 days of the First Meeting of Creditors and prove fraudulent intent to the bankruptcy judge.
What is the 90-day luxury goods rule?
Under 11 U.S.C. § 523(a)(2)(C), consumer debts owed to a single creditor exceeding $825 for luxury goods or services purchased within 90 days of filing are legally presumed to be nondischargeable. Similarly, cash advances exceeding $1,150 taken within 70 days are presumed fraudulent.
Can student loans be discharged in bankruptcy?
Student loans are generally non-dischargeable under § 523(a)(8) unless the debtor proves that repayment would impose an 'undue hardship' on the debtor and dependents. While historically difficult, updated Department of Justice and Department of Education guidance has made undue hardship settlements significantly more accessible.