In bankruptcy law, a discharge is when someone who filed for bankruptcy is freed from his or her debts and other financial obligations. Bankruptcy lawyers in Utah explain that under federal law, this order from the court is final, preventing creditors from charging the person for what is owed. Additionally, creditors cannot file any legal action against a person who had just been discharged from debt.While a discharge order can save people from paying most of their debts, there are some debts that do not qualify to be cleared. This could differ according to the type of bankruptcy filed by a person in court. Here are some debts that cannot be discharged, regardless of whether or not the person filed for a Chapter 7 or Chapter 13 bankruptcy.
Lawyers say filing for a Chapter 7 is a better option when it comes to eliminating tax debts, but this hinges on two things. One is that you actually qualify for a Chapter 7; the other is that your debts qualify for discharge. A federal tax lien or a government claim on a specific property cannot be discharged. Should the IRS find out that you have a federal tax lien, you’ll have to clear it by paying it off. Normally, income taxes can be discharged; but if the IRS says it was unable to pass the 240-day rule, it cannot be discharged. The IRS must have assessed your income tax at least 240 days prior to your filing for bankruptcy. Furthermore, it cannot be discharged if the debt is not at least three years old.
According to the Craig Swapp & Associates bankruptcy lawyers in Salt Lake City, child support is a form of domestic support obligation (DSO) and under the law this cannot be discharged even when one files for Chapter 7 or Chapter 13. DSOs are common with divorced couples who have children.
In general, bankruptcy cannot help people who filed fraudulent tax returns. These cases can happen when the person inputs the wrong information when filing his tax return (e.g. using a false Social Security Number). Being honest with relevant information will work in your favor during a bankruptcy case.
If a debt was not filed on time, it cannot be discharged. The Department of Justice, as well as lawyers specializing in bankruptcy Utah residents trust, advise that you list all your properties and debts when filing for bankruptcy. The law cannot certify that a person is telling the truth unless he can present proof justifying his claim.
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