Table of Contents
- Non-Dischargeable Debts: Student Loans, Taxes, and Other Exceptions
- What Are Non-Dischargeable Debts?
- 1. Student Loans: Rare, But Not Impossible
- 2. Tax Debts: Some May Qualify for Discharge
- 3. Domestic Support Obligations: Always Non-Dischargeable
- 4. Fines, Penalties, and Fraudulent Debts: Punitive by Nature
- Additional Non-Dischargeable Categories
- Chapter 13 May Help You Restructure Non-Dischargeable Debts
- Why It Matters to Work With a Bankruptcy Attorney Near You
- ReferU.AI Matches You With Attorneys Who Know the Exceptions
- Final Thought: Not All Debts Go Away—But You Still Have Options
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Navigating the complexities of non-dischargeable debts, such as student loans and tax obligations, can be daunting during bankruptcy. This guide outlines the types of debts that cannot be eliminated and emphasizes the importance of consulting an experienced attorney near you to explore your options and protect your financial future.
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Explore the complexities of non-dischargeable debts, including student loans, taxes, and domestic support obligations, in bankruptcy. Understand your options and find an attorney near you who can help navigate these challenging financial waters.
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Non-Dischargeable Debts: Student Loans, Taxes, and Other Exceptions
When most people think of bankruptcy, they imagine wiping the slate clean and starting fresh. But not all debts go away. In fact, certain types of debts—known as non-dischargeable debts—remain even after bankruptcy, either because they’re rooted in public policy or because courts want to discourage fraudulent behavior.
This guide walks you through the major categories of debts that are rarely or never discharged in bankruptcy, with practical insights into how they’re handled across different chapters. If you're facing bankruptcy and have one or more of these debts, understanding your options can help you make smarter decisions and avoid surprise consequences. Along the way, we’ll reference detailed articles that break each topic down further:
💡 For every post in this series, scroll down to “Related Posts.”
What Are Non-Dischargeable Debts?
Non-dischargeable debts are debts that survive bankruptcy. That means even after your case is closed and you receive a discharge, you’ll still be legally required to pay them. These debts are either listed as exceptions in Section 523 of the Bankruptcy Code, or they’re declared non-dischargeable after a court hearing called an adversary proceeding.
1. Student Loans: Rare, But Not Impossible
Student debt is one of the most burdensome financial obligations in America—and it’s also one of the hardest to eliminate through bankruptcy. As covered in Student Loans & Bankruptcy: Is Discharge Ever Possible?, student loans are only dischargeable under a very high legal threshold called the undue hardship test. Borrowers must file a separate lawsuit (adversary proceeding) and prove:
- Repayment would prevent maintaining a basic standard of living
- Their financial hardship is likely to continue
- They’ve made good faith efforts to repay
While full discharge is rare, recent guidance from the DOJ and DOE has started to make the process more accessible, especially for older borrowers or those with health issues.
2. Tax Debts: Some May Qualify for Discharge
Tax debt is another tricky area. Contrary to popular belief, some income taxes can be discharged if they meet certain timing requirements. As explained in Tax Debts and Bankruptcy: What You Need to Know About IRS Rules, federal and state income tax debts can be eliminated if they satisfy the 3-2-240 Rule:
- Tax return due 3 years before filing
- Return filed 2 years before filing
- Tax assessed 240 days before filing
But not all tax debts qualify. Trust fund taxes, fraud penalties, and recently assessed taxes are non-dischargeable. Even if your tax debt qualifies for discharge, liens may still survive the bankruptcy and attach to property.
3. Domestic Support Obligations: Always Non-Dischargeable
Child support and alimony—collectively called domestic support obligations (DSOs)—are always non-dischargeable in bankruptcy. As we detail in Domestic Support Obligations: Child Support and Alimony in Bankruptcy, these debts receive top priority and remain fully enforceable during and after your case.
Even if you’re behind on support payments, the bankruptcy court cannot eliminate or reduce those obligations. In Chapter 13, you can include arrears in your repayment plan, but you must catch up in full by the end of your plan term.
4. Fines, Penalties, and Fraudulent Debts: Punitive by Nature
If you’ve been fined by a court or government agency—or you incurred a debt through fraud, misrepresentation, or malicious conduct—you’re likely dealing with a non-dischargeable obligation. In Fines, Penalties, and Fraudulent Debts: Navigating Exceptions to Discharge, we explain that these include:
- Criminal fines and restitution
- Civil penalties (code violations, regulatory fines)
- Debts from fraud, embezzlement, or breach of fiduciary duty
Creditors often file adversary proceedings to prove these debts stem from misconduct. If they win, the debt survives your discharge—and you must repay it in full.
Additional Non-Dischargeable Categories
Beyond the major categories above, you may encounter other debts that bankruptcy won’t eliminate, including:
- Debts from drunk driving accidents
- Divorce-related property settlements (in some cases)
- Debts owed to pension or retirement plans
- Certain government overpayments (e.g., unemployment or social security)
Chapter 13 May Help You Restructure Non-Dischargeable Debts
Even if a debt can’t be eliminated, Chapter 13 bankruptcy allows you to restructure payments over time. This can help manage tax debt, child support arrears, or restitution while protecting your income and property from collection actions.
Why It Matters to Work With a Bankruptcy Attorney Near You
When your case involves non-dischargeable debt, expert guidance becomes essential. A bankruptcy attorney near you can:
- Analyze your debts to determine which are dischargeable
- Navigate adversary proceedings or creditor disputes
- Help you build a repayment plan that satisfies court requirements
- Protect you from legal missteps that could derail your discharge
ReferU.AI Matches You With Attorneys Who Know the Exceptions
ReferU.AI connects you with a bankruptcy attorney near you who understands non-dischargeable debts and how to build a filing strategy around them. Whether you’re dealing with student loans, IRS tax bills, support orders, or court penalties, our AI-driven platform helps you find attorneys with proven experience handling these complex cases.
Final Thought: Not All Debts Go Away—But You Still Have Options
Bankruptcy doesn’t erase everything—but it can still provide massive relief. Even if some debts survive, you may free up cash flow, pause collection actions, and get a clearer path forward. With the right legal partner, you’ll know exactly what you’re facing—and how to navigate it with confidence.
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