11 USC 1328: Chapter 13 Discharge Requirements and Hardship Option

To receive a Chapter 13 discharge, you must complete every payment your confirmed plan calls for, certify that your domestic support obligations are current, finish an approved personal financial management course, and confirm you haven’t received a disqualifying prior discharge. These are the Chapter 13 discharge requirements under 11 U.S.C. 1328(a), and missing any one of them will stop the court from entering your discharge order no matter how faithfully you made your plan payments.

The Four Requirements in Detail

Each requirement has its own trap, and the order of operations matters.

Complete All Plan Payments

Your confirmed plan runs three to five years. If your household income falls below your state’s median, the plan caps at three years, though a court can extend it to five for good cause. Above-median earners get a five-year plan.¹ Every scheduled payment has to clear. Falling behind doesn’t automatically kill the case, but it does mean you’ll need to either catch up, modify the plan, or seek a hardship discharge instead.

Certify Domestic Support Obligations Are Current

If you owe child support or alimony under a court order or statute, you must certify that every payment due through the date of certification has been made. That includes amounts that came due before you filed the bankruptcy petition, not just support that accrued during the case.² If there’s a gap, close it before you file the certification.

Complete the Financial Management Course

You must finish a personal financial management course from a provider approved by the U.S. Trustee Program and file the certificate of completion with the court. This is a different course from the credit counseling you took before filing. People confuse the two constantly, assume they’re done, and then watch their discharge stall because the right certificate isn’t on file.

Confirm No Disqualifying Prior Discharge

You cannot receive a Chapter 13 discharge if you already received one in a Chapter 13 case filed within the previous two years, or in a Chapter 7, 11, or 12 case filed within the previous four years.² The clock runs from the filing date of the prior case, not from when that prior discharge was entered.

If You Can’t Finish the Plan: Hardship Discharge

Section 1328(b) offers a narrow escape hatch when circumstances beyond your control make completing payments impossible. The court will require you to show three things:²

The failure to complete payments stems from circumstances you shouldn’t be held accountable for, such as severe medical issues or permanent disability. Losing a job you could have kept, or voluntarily reducing your income, won’t qualify.
Unsecured creditors have already received at least as much through the plan as they would have gotten in a Chapter 7 liquidation of your nonexempt assets.
Modifying the plan under Section 1329 isn’t a workable alternative.

Before the court will take a hardship request seriously, you’re expected to explore modification first. Under Section 1329, you, the trustee, or a creditor can propose changes at any time before payments are completed, including reducing payment amounts, extending the payment period up to the five-year statutory ceiling, or reducing payments by the cost of health insurance for you or your dependents.³ Modification keeps you on track for the broader standard discharge. The hardship discharge should be a last resort, and there’s a real reason for that, covered in the next section.

What the Discharge Wipes Out, and What Survives

Completing the plan matters because the standard Chapter 13 discharge is broader than almost any other bankruptcy discharge. Sometimes called a “superdischarge,” it eliminates most debts included in or provided for by your plan, along with claims that were disallowed during the case.² A debt arising from willful damage to someone else’s property, for instance, can be discharged under Section 1328(a) even though it would survive a Chapter 7 case. The standard discharge only pulls in a limited set of the nondischargeability categories from Section 523(a). A hardship discharge, by contrast, imports all of them under Section 1328(c), meaning several debt categories that would have been wiped out if you’d finished the plan will stick around.

Even a completed-plan discharge doesn’t touch certain categories:

Domestic support obligations. Child support and alimony survive every type of bankruptcy discharge.⁴

Certain tax debts. Recent income taxes, taxes where the return was filed late or not filed at all, and taxes tied to fraud all survive. Payroll taxes collected from employees but not forwarded to the government are nondischargeable because you held that money in trust.⁴ Older income taxes can sometimes be discharged, but the rules are technical and depend on when the return was filed and when the tax was assessed.

Debts from fraud. If you obtained money or goods through misrepresentation, the creditor can ask the court to declare the debt nondischargeable. The creditor has to raise the objection; if nobody objects, the debt gets discharged like any other.⁴

Student loans. Federal and private student loans survive unless you can prove undue hardship on you and your dependents. Most courts apply the Brunner test, which requires showing you cannot maintain a minimal standard of living while repaying, that your financial situation is likely to persist, and that you’ve made good-faith efforts to repay.⁴ Meeting the standard is notoriously difficult, though some courts have begun applying it less rigidly.

Criminal restitution and fines. Any restitution or criminal fine included in a sentence on a conviction survives. Damages from a civil action based on willful or malicious conduct that caused personal injury or death are nondischargeable under Section 1328(a)(4).²

Long-term obligations maintained through the plan. Debts treated under Section 1322(b)(5), typically home mortgages where you cured a default through the plan but kept making regular payments, are excluded from the discharge. You still owe the remaining balance after the case ends.

After Your Last Payment: Getting the Order Entered

Writing the last check doesn’t produce a discharge order on its own. The Chapter 13 trustee processes remaining distributions and eventually files a final report summarizing all financial activity in the case. That alone can take several months.

Before the court will enter the discharge, two documents need to be on file: your certificate of completion for the financial management course, and your certification regarding domestic support obligations.² If either is missing, the case sits in limbo. People lose months waiting on a discharge because they assumed the course certificate had been filed and nobody flagged it. Confirm with your attorney or check the docket directly.

Once everything is in order, the bankruptcy judge enters the discharge order. The gap between your last payment and the order varies by district and caseload, but several months is typical.

What the Discharge Does, and What It Doesn’t

The discharge is a permanent court order barring creditors from trying to collect discharged debts from you personally. Under Section 524, it voids any pre-existing judgment on discharged debts and functions as an injunction against lawsuits, wage garnishment, phone calls, and any other collection activity tied to those debts.⁵ A creditor who deliberately ignores the injunction faces contempt of court, with potential remedies including actual damages, attorney fees, and in egregious cases punitive sanctions.

The injunction only reaches your personal liability. Secured creditors keep their liens on collateral. If your plan didn’t pay off a car loan or mortgage in full, the lender can still repossess or foreclose even though you no longer owe the debt personally. The lien follows the property, not you.

Co-signers are another blind spot. During the case, Section 1301 generally shields anyone who co-signed a consumer debt alongside you from collection activity.⁶ Once your case ends, that protection lifts. Your discharge eliminates your liability but does nothing for your co-signer. If the debt wasn’t paid in full through the plan, the creditor can pursue the co-signer for the remainder. If protecting someone matters, the plan needs to pay that debt in full.

On taxes, the IRS normally treats canceled debt as income, but bankruptcy is the exception. Under Section 108 of the Internal Revenue Code, debts discharged in a Title 11 case are excluded from gross income.⁷ You still have to report the exclusion. Attach Form 982 to your return for the year of discharge, check the box for bankruptcy on line 1a, and enter the total discharged amount on line 2.⁸ Skip it, and when a creditor’s 1099-C hits the IRS you may end up fielding a notice that assumes you owe tax on the canceled amount.

Finally, the discharge isn’t absolutely final for one year. Under Section 1328(e), a party in interest can move to revoke it, but only within one year of the order, only on proof of fraud in obtaining the discharge, and only if the movant didn’t know about the fraud until after the order was entered.² The fraud contemplated is deliberate: concealing assets, fabricating income, intentional misrepresentations in the filings. Honest mistakes don’t qualify. After one year, revocation is off the table regardless of what later comes to light.

1
Office of the Law Revision Counsel. 11 U.S. Code 1322 – Contents of Plan
2
Office of the Law Revision Counsel. 11 USC 1328 – Discharge
3
Office of the Law Revision Counsel. 11 USC 1329 – Modification of Plan After Confirmation
4
Office of the Law Revision Counsel. 11 U.S. Code 523 – Exceptions to Discharge
5
Office of the Law Revision Counsel. 11 USC 524 – Effect of Discharge
6
Office of the Law Revision Counsel. 11 USC 1301 – Stay of Action Against Codebtor
7
Office of the Law Revision Counsel. 26 USC 108 – Income From Discharge of Indebtedness
8
Internal Revenue Service. Publication 4681 – Canceled Debts, Foreclosures, Repossessions, and Abandonments