Chapter 13 Trustee Discharge and Order Closing the Case

A Chapter 13 discharge and case closing happen as two separate court events after you finish your plan payments: the trustee audits your payments and files a final report, the judge enters a discharge order releasing you from personal liability on qualifying debts, and then the court issues a separate order formally closing the case. The whole wind-down usually takes several months after your last payment, and a few requirements on your side can delay the discharge if you miss them.

What You Must Finish Before Discharge

Two things on your side have to be done before the judge will sign the discharge order.

First, you have to complete a post-filing instructional course on personal financial management.¹ Skipping this course is one of the most common reasons a discharge gets delayed or denied, and if the case closes without it, the fix requires reopening the case and paying a fee.

Second, if you owe domestic support, you have to certify that all amounts due through the certification date have been paid.² Child support and alimony survive the discharge regardless, but the certification is a precondition to getting any discharge at all.

You also need to be current on any ongoing mortgage payments that fell due during the plan outside the trustee’s distributions. If a modification was needed partway through the plan to keep things workable, that should already be resolved by the time you reach the final payment.

The Trustee’s Final Report

Once you make your last plan payment and the trustee confirms every required amount has been received, the trustee runs a final audit and files a Certificate of Final Payment with the court. Within roughly 150 days after that certificate, the trustee files a Final Report accounting for every dollar collected, how funds were distributed among creditors, which claims were paid in full, and which received partial payment.

Nothing is required of you during this stretch beyond responding to any requests from the trustee’s office. The court won’t enter your discharge until the final report is filed and the court is satisfied that all plan requirements have been met.

The Discharge Order and What It Wipes Out

The discharge order releases you from personal liability on all debts that were provided for by the plan, except for categories the law specifically excludes.³ It operates as a permanent injunction barring any creditor from pursuing collection on a discharged debt by lawsuit, phone call, letter, or any other contact.⁴ The court clerk mails copies of the order to all creditors, the U.S. Trustee, the case trustee, and your attorney.

A standard Chapter 13 completion discharge is broader than what you’d receive in Chapter 7, but these categories still survive:

Domestic support obligations, including child support and alimony.
Certain tax debts, including taxes from fraudulent returns, taxes you tried to evade, and taxes for which a late return was filed less than two years before the bankruptcy petition.⁵
Government-backed and qualified private student loans, unless you prove repayment would cause undue hardship through a separate lawsuit within the bankruptcy case. The Department of Education updated its guidance in 2024 to establish clearer criteria for evaluating hardship claims, but the legal standard remains demanding.⁶
Debts obtained through fraud, false pretenses, or misrepresentation, when a creditor affirmatively asks the court to except the debt from discharge.
Restitution and fines included in a criminal sentence.
Debts for death or personal injury caused by driving while intoxicated.⁵
Civil damages for willful or malicious conduct that caused personal injury or death. Debts from willful or malicious damage to property can be discharged in a standard Chapter 13 completion, which is one area where Chapter 13 offers broader relief than Chapter 7.³

Keep your copy of the discharge order permanently. Years later, if a creditor or debt collector tries to collect on a discharged debt, that order is your proof that the debt is legally unenforceable.

Liens and Co-Signers After Discharge

The discharge eliminates your personal obligation on a debt. It does not automatically remove a creditor’s lien on your property. A mortgage lender can no longer sue you personally for the balance, but the lien stays attached to the house, and if you stop paying, the lender can still foreclose. Any lien that wasn’t stripped or modified during the plan remains fully enforceable against the collateral.²

Co-signers lose their protection too. While the case was open, the Chapter 13 co-debtor stay kept creditors from pursuing anyone who co-signed a consumer debt with you. That protection ends when the case is closed, dismissed, or converted to Chapter 7.⁷ If the plan paid the co-signed debt in full, closure doesn’t matter because nothing is left to collect. If the plan only paid part of it, the creditor can pursue your co-signer for the balance once the stay lifts. Your discharge protects you, not the person who signed with you.

The Order Closing the Case

After the discharge is entered and the trustee has completed all duties, the court issues a separate order formally closing the case. Closing means every motion has been ruled on, every distribution has been made, and the trustee has filed a statement confirming that all trustee responsibilities are finished.⁸

Closing and discharge are not the same event. A case can close without a discharge if the debtor failed to meet a requirement, and a discharge can be entered while the case stays open while the trustee finishes administrative work. Once the closure order is entered, the trustee is formally released, and the bankruptcy court’s active oversight of your case ends.

After Closing: Taxes, Credit Reports, and Recordkeeping

Outside bankruptcy, canceled debt is normally taxable income. Bankruptcy is the major exception. Debt discharged in a Title 11 case, including Chapter 13, is excluded from your gross income entirely.⁹ You report the exclusion by attaching Form 982 to your federal return for the year of the discharge, checking the box for Title 11 bankruptcy and entering the total amount discharged. The exclusion comes with a trade-off: you must reduce certain tax attributes like net operating losses or credit carryforwards by the amount excluded, though for most individual filers this has minimal practical impact.¹⁰ Forgetting Form 982 doesn’t make the discharged debt taxable, but it can trigger an IRS inquiry if a creditor reports the cancellation on a 1099-C.

A Chapter 13 filing can stay on your credit report for up to 10 years from the filing date.¹¹ Individual accounts included in the bankruptcy should show a zero balance after discharge, but credit bureaus don’t always update promptly. Pull your reports from all three major bureaus once your case closes and check every account that was part of the bankruptcy. If a discharged debt still shows an outstanding balance or active collection status, dispute it with each credit reporting company and with the creditor that furnished the incorrect information. Include a copy of your discharge order. The bureau must investigate and correct verified errors, and the furnisher has 30 days to respond.¹²

Keep the discharge order, the trustee’s final report, and your plan completion records indefinitely. These are your proof that specific debts were discharged, and you may need them years later if a debt buyer purchases old accounts and tries to collect. A creditor who knowingly violates the discharge injunction can face contempt sanctions, but enforcing that right starts with having the paperwork.

Reopening a Closed Case

A closed case isn’t necessarily the last word. Federal law allows the court to reopen a case to administer assets, grant relief to the debtor, or for other sufficient cause.¹³ Common reasons include obtaining a discharge that wasn’t entered before closure (often because the financial management course wasn’t completed on time), addressing a creditor who violates the discharge injunction, or dealing with an asset that was overlooked.

Reopening requires filing a motion and paying a court fee of $235.¹⁴ The court decides whether to grant the motion, so the reason needs to be specific. Reopening doesn’t restart the automatic stay or give you a new repayment plan. It lets the court address the narrow issue that prompted the motion.

If You Can’t Finish the Plan

If you reach this page because the plan isn’t going to complete, the end-of-case picture looks different. You can ask the court to dismiss the case at any time, and the court must grant that request as long as the case hasn’t already been converted from another chapter.¹⁵ Dismissal gives you no discharge, lets creditors resume collection, and adds back the interest that was paused during the case. You can also convert to Chapter 7, which liquidates non-exempt assets and gives you a Chapter 7 discharge instead.

If circumstances beyond your control prevent you from finishing and modification won’t fix the problem, the court can grant a hardship discharge. Three conditions must be met: the failure to pay isn’t your fault, unsecured creditors have already received at least as much as they would have in a Chapter 7 liquidation, and further plan modification isn’t practical.¹ A hardship discharge covers fewer debts than a completion discharge, because the full range of non-dischargeable debt categories applies, not just the narrower list that applies when you finish the plan.⁵

1
Office of the Law Revision Counsel. 11 USC 1328 – Discharge
2
United States Courts. Chapter 13 – Bankruptcy Basics
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Office of the Law Revision Counsel. 11 USC 1328 – Discharge
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United States Courts. Discharge in Bankruptcy – Bankruptcy Basics
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Office of the Law Revision Counsel. 11 USC 523 – Exceptions to Discharge
6
Federal Student Aid Knowledge Center. Undue Hardship Discharge of Title IV Loans in Bankruptcy Adversary Proceedings
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Office of the Law Revision Counsel. 11 USC 1301 – Stay of Action Against Codebtor
8
United States Bankruptcy Court. Dismissal, Conversion and Closing of a Bankruptcy Case, What Are the Differences Between Them
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Office of the Law Revision Counsel. 26 USC 108 – Income From Discharge of Indebtedness
10
Internal Revenue Service. Publication 4681 – Canceled Debts, Foreclosures, Repossessions, and Abandonments
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Office of the Law Revision Counsel. 15 USC 1681c – Requirements Relating to Information Contained in Consumer Reports
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Consumer Financial Protection Bureau. How Do I Dispute an Error on My Credit Report
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Office of the Law Revision Counsel. 11 USC 350 – Closing and Reopening Cases
14
United States Courts. Bankruptcy Court Miscellaneous Fee Schedule
15
GovInfo. 11 USC 1307 – Conversion or Dismissal