When you file for bankruptcy, your goal is a discharge of your debts. However, not everything is covered by a bankruptcy discharge. Though you can expect the vast majority of debt to be swept away, there are a few debts that a person is held accountable for after filing for bankruptcy.

Debts that will be discharged vary depending on what chapter is applied, Section 523(a) of the Bankruptcy Code provides specific exceptions for certain types of debt. Chapters 7, 11, and 12 have 19 categories of debt that are exempt from discharge. Chapter 13 has a much shorter list of exceptions.

The most common exceptions come in the form of tax claims, debts not listed on your bankruptcy schedules (except if you filed what is called a “no-asset Chapter 7″ bankruptcy case), alimony or child support payments, debts brought about by intentional injury or property damage caused by the debtor (these are discharged in a Chapter 13, but not in Chapter 7), fines and penalties owed to government agencies, government-funded student loans, personal injury debts caused by the debtor while driving a vehicle under the influence of drugs or alcohol, debts owed to tax-advantaged pension plans, and certain cooperative housing fees.

Before filing a bankruptcy, it is important to be aware that every case is unique. Depending on the circumstances, a person may qualify for more or less debt discharge than another. Before filing for bankruptcy, a debtor should be well-versed on the specifics of his or her case.

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The U.S. Bankruptcy Code states that once a debt has been discharged, no attempts may be made to collect on that debt. Unfortunately, it is not uncommon for unethical creditors and collections agencies to continue attempts to collect.

There are a few things to be aware of should you ever find yourself being hounded because of a debt that you no longer have any legal responsibility to pay.

From time to time, a creditor will sell an account that has been discharged in bankruptcy. The new owner of the debt will then attempt to collect from you. This is clearly illegal.

When reminded that the debt was discharged in bankruptcy court, the collectors may try to tell you that the discharge does not apply to that collections agency, since they were not listed on the original court documentation. To put it simply, they are lying. They are banking that your will not know any better and simply pay the debt. To make matters worse, they will often use intimidation tactics to further confuse you, hoping to force payment.

Another tactic employed by these questionable creditors and collectors is a little sneakier. Instead of calling or sending letters, they will report the discharged debt one or all of the credit reporting bureaus. By doing this, they lower your credit score and wait for you to discover this when you apply for credit. Should you find this to be the case, it is important to notify the credit bureaus of the inaccuracy to have it removed from your credit report.

Certain creditors and collections agencies are so ruthless in their pursuit of money that they will ignore rulings of the court and try to pressure you into paying debts that you do not owe. It is important to be aware that these companies are out there and what to do if you find one of them attempting to ruin your chances for a fresh start.

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With more and more companies facing bankruptcy, many employees are worried about their futures.

Beyond the question of finding a new job, Americans are concerned about hat will happen to their pensions if their company files for bankruptcy.

Once a company files for bankruptcy, pension payments may be suspended. This does not mean that they are no longer paying people that are drawing money from their pensions. It means that the company is no longer contributing to the pension fund for current employees.

Would an employee be able to draw out of the pension if they leave the job under normal circumstances? Will bankruptcy affect the funds already in the pension plan? Those are the primary concerns of many, and rightly so.

When a company files for bankruptcy, the value of its stock generally plummets. If you have a 401(k) that is partially invested in company stock then you will not be able to avoid taking some losses. Another thing to be wary of is the possibility that the company has illegally dipped into the pension or 401(k) funds to try and stave off financial hardships. This scenario is extremely rare.

If you find that your company is on the verge of bankruptcy and you’ve considered early retirement, you don’t need to worry about your pension funds. However, it is important to understand the fees and penalties that accompany early withdrawal. Make sure you have explored all of your options before moving forward.

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On October 17, 2005, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 was passed in response to increased filings across the nation. The revised law provided stricter guidelines for who qualified for Chapter 7 bankruptcy, added a financial counseling requirement, and increased the amount of income that Chapter 13 bankruptcy filers had to pay to their creditors. These revisions were meant to put a stop to high-income people abusing the bankruptcy system, which had become commonplace.

Almost exactly three years later, some critics are wondering if the act had its desired effect. Of course, anyone paying even a modest amount of attention to global events know that it is not doing a thing.

With the current global economic crisis in full swing, the collapse of the housing market, and the ever-increasing difficulty in obtaining loans, bankruptcy courts are once again filling up. According to bankruptcy expert and University of Illinois law professor Robert Lawless, “The law did nothing to fix the underlying problem. There’s still the same amount of distress in the American middle class.” With bankruptcy filings averaging almost 4,500 a day in September, many experts believe the rate will not decline until people stop borrowing.

The desired effect of the 2005 act was to eliminate those that were willfully running up debt and filing bankruptcy to simply walk away. While the act may have reduced the numbers of those playing that sort of financial game, it has done nothing to address the prevalence of the credit-based economy that so many have come to depend on.

Unfortunately, the law has had the reverse impact on many. Since the 2005 revision, it is now much more costly to file for bankruptcy, which means that many people that are in legitimate need of bankruptcy protection can no longer afford it. This has led some consumers to undertake the difficult path of filing alone. Bankruptcy is a complex legal process that many are simply not equipped to handle alone. This means that many find themselves stuck with debt that would normally have been discharged. As the economic situation continues its decline, it is becoming obvious that more change is needed besides the patches and minor changes that the 2005 legislation brought about.

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Bankruptcy filings have become more frequent lately. As corporations, consumers, and banks become increasingly tight-fisted with their money, layoffs are also becoming more common and finding work may be difficult.

If you were living on a tight budget before the economic crisis, your troubles could multiply quickly in the current climate. If you should find yourself in a position that makes bankruptcy a viable option, you should be wary of whom you take advice from. As the old saying goes, you get what you pay for.

If you’re thinking of filing for bankruptcy, the attorney fees are probably foremost in your mind. After all, you don’t want to dig yourself deeper in debt when you’re trying to get out from under it. In this situation, a low-cost attorney may seem attractive, but this is a clear case of buyer beware.

Bankruptcy lawyers that advertise lower rates may not be in a position to treat your case with the care that it deserves. After all, they are being underpaid and must therefore take on more clients that might otherwise be the case.

Another pitfall of low-cost bankruptcies is simply bad advice. Some storefront bankruptcy petition preparers have no affiliation with an attorney at all. These establishments have been known to give clients wrong information, like telling them that chapter 13 protection is not bankruptcy, but rather a repayment plan. Of course, chapter 13 bankruptcy is bankruptcy.

If you have found yourself seriously considering bankruptcy, you should meet with an experienced bankruptcy lawyer, not the least expensive service you can find that promises to help you file.

A qualified attorney will be able to properly explain all of your options in terms that you can understand. He or she will do everything within their power to help you get your financial legs under you again.

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