In a bankruptcy case, the court and the debtor work together to formulate a plan for creditor repayment. In exchange for his or her cooperation, the debtor is absolved of further liability for the debt. All remaining debts are discharged, and the debtor no longer has legal responsibility. Here, you will learn which debts are dischargeable and which cannot be eliminated.
Can Attorney’s Fees be Discharged?
In a personal bankruptcy, most debts can be discharged. According to the US bankruptcy code, alimony, child support, fraudulent debt, student loans, medical bills from DUI cases, court fees and luxury items bought immediately before filing cannot be discharged.
Because a current attorney’s fees are included in the court costs, they will be paid -; but a lawyer hired before the filing may not be compensated. An attorney with unpaid fees can file a complaint with the court, claiming that the fees were not dischargeable.
These claims have a low rate of success, because they defeat the purpose of a bankruptcy, which is to give the debtor a clean financial slate. To contend with this, some attorneys have increased retainer rates, and now encourage clients to file for bankruptcy protection before the term of service begins.
Filing for Bankruptcy After a Divorce
A family law attorney often encounters issues when a client files for bankruptcy immediately after a divorce. Family lawyers believe that their fees cannot be discharged, because they help clients support their children -; and child support is a non-dischargeable debt. The BAPCA, which went into effect in 2005, made child support discharge laws even stricter.
Discharging Court Fees and Fines
In most cases, court fees and fines cannot be discharged during a bankruptcy. These fees imposed by courts are meant to punish lawbreakers, and it would not be fair to punish people because they cannot afford to pay the fees. The only exception is if the fees are not punitive; in a personal injury suit, the damages aren’t meant to punish, but to make things right for the victim.
Hiring a Bankruptcy Attorney
Personal bankruptcy is a complex process, and laws vary depending on bankruptcy type and filing location. Shipman Dixon & Livingston Co. L.P.A. knows state law, and he or she can recommend the appropriate chapter. By hiring a Bankruptcy Lawyer Piqua OH, you will ensure that your paperwork is filed in a timely manner -; and that all dischargeable debts are handled. Browse website for more information.