Not all debts are discharged in bankruptcy. The debts discharged vary under each chapter of the Bankruptcy Code. Section 523(a) of the Bankruptcy Code specifically excepts various categories of debts from the discharge granted to individual debtors.
Therefore, the debtor must still repay those debts after bankruptcy. Congress has determined that these types of debts are not dischargeable for public policy reasons (based either on the nature of the debt or the fact that the debts were incurred due to improper behavior of the debtor, such as the debtor's drunken driving).
There are 19 categories of debt excepted from discharge under chapters 7, 11, and 12. A more limited list of exceptions applies to cases under chapter 13.
Generally speaking, the exceptions to discharge apply automatically if the language prescribed by section 523(a) applies. The most common types of nondischargeable debts are:
• certain types of tax claims
• debts not set forth by the debtor on the lists and schedules the debtor must file with the court
• debts for spousal or child support or alimony
• debts for willful and malicious injuries to person or property
• debts to governmental units for fines and penalties
• debts for most government funded or guaranteed educational loans or benefit overpayments
• debts for personal injury caused by the debtor's operation of a motor vehicle while intoxicated
• debts owed to certain tax-advantaged retirement plans
• debts for certain condominium or cooperative housing fees.
In Texas, as in all states, bankruptcy proceedings are governed by federal law, specifically the Bankruptcy Code. Under Section 523(a) of the Bankruptcy Code, certain types of debts are not dischargeable, meaning the debtor is still responsible for repaying them after the bankruptcy process is complete. These exceptions to discharge are based on public policy considerations, often related to the nature of the debt or misconduct by the debtor. The most common types of nondischargeable debts include certain tax obligations, debts omitted from the debtor's required filings, family support obligations such as alimony and child support, debts from willful and malicious injuries, fines and penalties owed to government entities, certain student loans or educational benefit overpayments, debts from personal injury caused by driving under the influence, and certain debts related to retirement plans and housing fees. While Chapters 7, 11, and 12 have a broader list of nondischargeable debts, Chapter 13 has a more limited list. These exceptions generally apply automatically without the need for a court hearing, provided the debt fits the criteria outlined in the Bankruptcy Code.
