Summary: Bankruptcy wipes out most unsecured consumer debt: credit cards, medical bills, personal loans, old utility bills, and deficiencies after repossession. It does not wipe out domestic support obligations, most recent taxes, most student loans, court fines and criminal restitution, or debts from fraud. Secured debts are treated separately: bankruptcy can discharge your personal liability, but the lien survives unless you surrender the collateral or use Chapter 13 tools. Knowing which of your debts actually die in bankruptcy is the first question to answer before paying any filing fee.
The discharge kills unsecured debts with no collateral behind them. The standard list: credit card balances, medical bills (the most common bankruptcy debt in America), personal loans, old utility and phone bills, deficiency balances after a car repossession or foreclosure, business debts you personally guaranteed, and most lawsuit judgments for negligence.
If your debt is mostly in these categories, bankruptcy does what it promises: a genuine fresh start, with the discharge order permanently barring collectors from pursuing the discharged debts.
Domestic support obligations, child support and alimony, are never discharged in any chapter. Neither are property settlement debts owed to a spouse in Chapter 7 (Chapter 13 can discharge some property-division debts, a notable difference). These obligations also get priority treatment and are grounds for denying discharge if unpaid.
The policy is explicit: bankruptcy is not an exit from family obligations. Budget for these surviving in full.
Recent income taxes (generally returns due within 3 years, assessed within 240 days) survive; older income taxes meeting the 3-year/2-year/240-day rules can be discharged. Payroll taxes you withheld from employees never discharge. Student loans require proving 'undue hardship' in an adversary proceeding, a difficult but no longer impossible standard; recent guidance has made these discharges more attainable, but they remain the exception.
Map every tax year and every loan against these rules before filing. A case that discharges $50,000 of cards but leaves $80,000 of student loans and recent taxes may not be worth the credit damage.
Debts from fraud, embezzlement, or willful and malicious injury survive if the creditor proves it in an adversary proceeding. Court fines, criminal restitution, and most government penalties survive. DUI injury debts survive. Debts you forgot to list can survive in some districts, which is why complete schedules matter.
Luxury purchases and cash advances right before filing get presumed fraudulent ($800-plus in luxury goods within 90 days, $1,100-plus in cash advances within 70 days, under 11 U.S.C. 523(a)(2)(C)). Stop using the cards once bankruptcy is on the table.
Bankruptcy discharges your personal liability on secured debts, but the lien survives. Stop paying the mortgage and the lender still forecloses; stop paying the car loan and the lender still repossesses. Your options per asset: reaffirm (keep paying, keep the asset), redeem (Chapter 7: pay the current value in a lump sum), surrender (give it back, deficiency discharged), or in Chapter 13, cram down certain loans to collateral value and cure arrears through the plan.
Run the equity math on every secured asset before filing. Voluntary surrender of an underwater car plus discharge of the deficiency is often the smartest move in the case.
Before paying any fee, list every debt in three columns: dies, survives, depends (secured, taxes near the line, student loans). Total the 'dies' column. If it is not several multiples of the filing cost, bankruptcy may be the wrong tool; direct negotiation or a debt management plan may serve better.
Bring the audit to a bankruptcy attorney's free consultation. The good ones will tell you when not to file, and that answer is worth as much as the filing itself.
Yes. Credit card balances are the textbook dischargeable debt in both Chapter 7 and Chapter 13.
Yes. Medical bills are unsecured and dischargeable; they are among the most commonly discharged debts in American bankruptcies.
Usually no. Student loans require proving undue hardship in a separate adversary proceeding. Recent federal guidance has made these discharges somewhat more attainable, but they remain difficult.
Some. Older income taxes meeting the 3-year/2-year/240-day rules can discharge; recent taxes, payroll trust-fund taxes, and tax liens generally survive.
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Data current as of October 2026. Sources: 11 U.S.C. 523 (exceptions to discharge); 11 U.S.C. 727/1328 (discharge provisions). Legal information only, not legal advice.