What Bankruptcy Can and Can't Discharge

The General Rule and Its Exceptions

A Chapter 7 discharge releases the debtor from personal liability for most unsecured debts — but not all of them. According to the U.S. Courts (uscourts.gov), the Bankruptcy Code carves out specific categories that generally survive bankruptcy. Knowing which side of that line your debts fall on is the difference between a meaningful fresh start and a discharge that leaves your hardest obligations untouched. People's Justice is not a law firm and does not provide legal advice; what follows is general information about the categories the courts describe.

Debts Chapter 7 Typically Discharges

Most unsecured consumer debts are dischargeable. These commonly include credit card balances, medical bills, personal loans, most older income tax debt that meets the Code's timing tests, deficiency balances after a repossession, and many civil judgments not based on fraud. For these obligations, the discharge wipes out the debtor's personal liability, and creditors are permanently barred from collecting.

Debts That Generally Survive Bankruptcy

Most recent taxes

Per uscourts.gov, most recent tax debts are nondischargeable. Some older income taxes can be discharged if they satisfy the Code's strict timing and filing requirements, but recent taxes, trust-fund taxes, and similar obligations generally survive.

Domestic support obligations

Child support and alimony — the Code's 'domestic support obligations' — are not dischargeable in Chapter 7 (uscourts.gov). These obligations remain fully owed after the case closes.

Most student loans

Most student loans survive a standard Chapter 7 discharge. The exception, per uscourts.gov, is where the borrower obtains an 'undue hardship' determination — and that requires filing a separate adversary proceeding within the bankruptcy case, not the ordinary discharge. Student-loan discharge in bankruptcy is its own distinct process with its own legal standard.

Debts from fraud

Debts arising from fraud, false representations, or willful and malicious injury are generally nondischargeable (uscourts.gov). A creditor may have to raise the issue in the case, but obligations rooted in fraud are not the fresh-start debts Chapter 7 is designed to clear.

Secured Debts Are Different

Discharge eliminates personal liability, but it does not automatically remove a lien. For secured debts — a mortgage on your home or a loan on your car — the lender's lien on the collateral can survive the discharge. In practical terms, that means you can walk away from the debt by surrendering the property, but keeping the house or car generally means continuing to pay. This is why 'what gets discharged' and 'what you keep' are two different questions.

Whether a particular debt — especially a tax or a secured obligation — is dischargeable in your case is a fact-specific legal determination. People's Justice is not a law firm and does not provide legal advice; we are not a government agency. We can connect you with a licensed attorney to analyze which of your debts would actually be discharged.