Dischargeability in Bankruptcy: What Survives and What’s Wiped Out

Dischargeability in bankruptcy comes down to a sorting exercise: most unsecured debts — credit cards, medical bills, personal loans, old utility balances — are wiped out when the court enters your discharge order, while a specific list of obligations survives either automatically or because a creditor successfully objects. The categories that survive include child support and alimony, recent income taxes, criminal fines and restitution, debts from drunk-driving injuries, post-filing HOA fees, and most student loans. A separate group — fraud, embezzlement, and willful injury debts — gets discharged unless the creditor files a timely challenge inside your case.

What a Discharge Actually Eliminates

A discharge order wipes out your personal liability for covered debts and imposes a permanent injunction against any further collection. Creditors cannot sue you, call, write, or report the balance as owed.1United States Courts. Discharge in Bankruptcy – Bankruptcy Basics The debt does not go dormant; as a personal obligation, it ceases to exist.

What the order does not do is erase liens. If a creditor holds a mortgage, car loan, or other security interest in your property, that lien passes through bankruptcy intact. The creditor can still foreclose or repossess to recover the collateral, even though they can no longer come after you personally for a shortfall.1United States Courts. Discharge in Bankruptcy – Bankruptcy Basics Keeping the house or car after bankruptcy generally means staying current on payments.

Debts the Discharge Usually Wipes Out

A Chapter 7 discharge covers every debt that arose before the filing date, except those the statute specifically excludes.2Office of the Law Revision Counsel. 11 U.S.C. 727 – Discharge For most filers, that sweeps away:

  • Credit card balances
  • Medical bills
  • Personal loans and signature loans
  • Past-due utility charges
  • Deficiency balances on repossessed cars
  • Older unpaid rent and most civil judgments for money
  • Pre-filing homeowners’ association arrears

Once the order is signed, these obligations are gone. Future wages and property you acquire after filing belong to you.

Debts That Survive Automatically

Federal law lists categories of debt that pass through bankruptcy whether the creditor does anything or not.3Office of the Law Revision Counsel. 11 U.S. Code 523 – Exceptions to Discharge If your debt fits one of these descriptions, you will still owe it after the case closes.

Child Support and Alimony

Domestic support obligations cannot be discharged under any chapter.3Office of the Law Revision Counsel. 11 U.S. Code 523 – Exceptions to Discharge A Chapter 13 debtor also has to certify that all support payments are current before the court will grant any discharge at all.4Office of the Law Revision Counsel. 11 U.S. Code 1328 – Discharge

Recent Tax Debts

Income taxes are nondischargeable unless the debt is old enough to clear every part of the “3-2-240” test. All three must be true:

  • The return was due at least three years before you filed bankruptcy, counting from the extended deadline if you got an extension.
  • You actually filed the return at least two years before filing. Substitute returns the IRS prepared may not count.
  • The IRS formally assessed the tax at least 240 days before your petition.

Fail any single prong and the tax survives. The IRS confirms Chapter 7 discharges personal liability for income taxes older than three years when returns were filed on time.5Internal Revenue Service. Declaring Bankruptcy Penalties tied to nondischargeable tax years survive along with the underlying tax. Payroll trust fund taxes and recent withholdings are not dischargeable.

Criminal Fines and Restitution

Court-imposed fines, penalties, and criminal restitution orders all survive.3Office of the Law Revision Counsel. 11 U.S. Code 523 – Exceptions to Discharge Chapter 13 is explicit that any restitution or fine in a criminal sentence stays intact.4Office of the Law Revision Counsel. 11 U.S. Code 1328 – Discharge

Drunk Driving Injury Debts

Debts for death or personal injury caused by operating a vehicle, boat, or aircraft while intoxicated are nondischargeable.6Office of the Law Revision Counsel. 11 U.S.C. 523 – Exceptions to Discharge A criminal conviction is not required. The bankruptcy court can decide for itself whether intoxication caused the injury.

HOA Fees After Filing

Assessments that come due after you file remain your obligation for as long as you (or the trustee) hold an ownership interest in the unit.6Office of the Law Revision Counsel. 11 U.S.C. 523 – Exceptions to Discharge Pre-filing arrears are treated like other unsecured debt and can be wiped out. People regularly misread this and assume bankruptcy ends every HOA obligation.

Student Loans

Student loans are dischargeable only on a showing of “undue hardship,” historically a difficult standard.7Federal Student Aid. Discharge in Bankruptcy Courts apply either the Brunner test or a totality-of-circumstances analysis, both asking whether you can maintain a minimal standard of living while repaying, whether the hardship is likely to persist, and whether you have made good-faith efforts to repay.8Federal Student Aid. Undue Hardship Discharge of Title IV Loans in Bankruptcy Adversary Proceedings

Department of Education guidance issued in 2022 and revised in 2024 directs government attorneys to use objective criteria, including IRS expense standards, when evaluating undue hardship claims on federal loans.8Federal Student Aid. Undue Hardship Discharge of Title IV Loans in Bankruptcy Adversary Proceedings A discharge still requires a separate adversary proceeding inside the bankruptcy case. The CFPB has pointed out that some education loans are not “qualified student loans” at all — loans from unaccredited schools, for example — and those can be dischargeable like ordinary consumer debt.9Consumer Financial Protection Bureau. Busting Myths About Bankruptcy and Private Student Loans

Debts That Survive Only If a Creditor Objects

A separate group of debts under Section 523(c) is dischargeable by default. They become nondischargeable only if the creditor files a complaint inside the bankruptcy case — and does so on time. The three main categories:

  • Money, property, or credit obtained by false pretenses or actual fraud.3Office of the Law Revision Counsel. 11 U.S. Code 523 – Exceptions to Discharge
  • Debts from embezzlement, larceny, or fraud in a fiduciary role.
  • Debts for willful and malicious injury to another person or their property.

The deadline is strict. A creditor has 60 days from the first date set for the meeting of creditors to file an adversary proceeding challenging dischargeability.10Legal Information Institute. Federal Rules of Bankruptcy Procedure Rule 4007 – Determining Whether a Debt Is Dischargeable Miss it and the debt is discharged, no matter how bad the underlying conduct looked.

Two fraud presumptions catch recent credit use. Luxury goods or services totaling more than $900 from a single creditor within 90 days of filing are presumed fraudulent. Cash advances over $1,250 taken within 70 days of filing carry the same presumption.11Federal Register. Adjustment of Certain Dollar Amounts Applicable to Bankruptcy Cases These thresholds, effective April 1, 2025, shift the burden to the debtor to show legitimate intent.

Where Chapter 13 Discharges More

Chapter 13 historically allowed a broader discharge after plan completion, sometimes called the “super discharge.” The clearest practical difference involves divorce. In Chapter 7, every debt arising from a divorce or separation agreement is nondischargeable, including property settlement obligations. In Chapter 13, a non-support property settlement debt can be discharged after you finish your three-to-five-year plan.4Office of the Law Revision Counsel. 11 U.S. Code 1328 – Discharge Alimony and child support stay protected under both chapters.

Whether a divorce obligation counts as “support” or “property settlement” is a question of federal bankruptcy law, not state family law. Courts look at the financial circumstances of each spouse, the structure and timing of the payments, and whether the receiving spouse or children could get by without them.

Co-Signers and Reaffirmation

Your discharge releases you. It does nothing for a co-signer or joint borrower, who remains fully liable for the balance. Chapter 13 adds a partial shield: while you are making plan payments on a co-signed consumer debt, an automatic co-debtor stay keeps the creditor off the co-signer. The protection ends when the case closes.

Reaffirmation runs in the opposite direction. You can voluntarily keep a specific debt alive by signing a reaffirmation agreement, most often to hold onto a car.12Office of the Law Revision Counsel. 11 U.S. Code 524 – Effect of Discharge The agreement has to be filed before the discharge is entered and must include disclosures about the amount owed and whether you can afford the payments.13United States Courts. Instructions for Director’s Form 2400A Reaffirmation Documents You can cancel it any time before discharge or within 60 days after filing it with the court, whichever is later. A judge who sees an obvious hardship will refuse to approve the agreement.

The risk is simple. If you reaffirm and later default, you are in the same spot as if you had never filed. The creditor can repossess the collateral and sue you for any deficiency. On a car that depreciates fast, that deficiency can run into real money. Reaffirming makes sense only when you need the collateral and the budget actually supports the payment.

When the Entire Discharge Can Be Denied

Everything above involves individual debts. A court can also deny the entire Chapter 7 discharge, which means no debts are eliminated at all. The grounds include:14Office of the Law Revision Counsel. 11 U.S.C. 727 – Discharge

  • Transferring, concealing, or destroying property within one year before filing or during the case, with intent to defraud creditors
  • Concealing, falsifying, or failing to keep financial records
  • Making a false oath, filing a false claim, or withholding records from the trustee
  • Failing to adequately explain a loss of assets
  • Having received a Chapter 7 discharge in a case filed within the past eight years, or a Chapter 13 discharge in a case filed within the past six years (with limited exceptions)

Trustees watch for the warning signs, and creditors can object as well. Honesty on the schedules is what keeps the discharge intact.

Enforcing the Discharge Afterward

The discharge order is a permanent injunction. A creditor who calls, writes, sues, offsets funds, or reports the debt as still owed can be held in civil contempt by the bankruptcy court, which can impose sanctions and award damages and attorney fees.1United States Courts. Discharge in Bankruptcy – Bankruptcy Basics The order also voids any prior judgment to the extent it determined your personal liability on a discharged debt.12Office of the Law Revision Counsel. 11 U.S. Code 524 – Effect of Discharge

Credit reporting is where discharge violations most often show up. A discharged debt should not appear as active, delinquent, or carrying a balance owed. Pull your reports from all three major bureaus within a couple of months after discharge, dispute anything that still shows a balance, and keep copies. A Chapter 7 filing can stay on your report for up to 10 years from the filing date; Chapter 13 can also stay up to 10 years from the order for relief.15Consumer Financial Protection Bureau. How Long Does a Bankruptcy Appear on Credit Reports The record remains visible, but the underlying debts, once discharged, are no longer yours to pay.