Dischargeable Debts

News & Analysis as of

Can Debts Caused by a DUI Be Discharged in Bankruptcy?

With the 4th of July weekend coming up, DUI task forces will be out. This got me thinking about the relationship between DUI and bankruptcy. I work in an office next to John Skiba and we’ve talked about how these practice...more

Bankruptcy Beat: Former NFL Player Defeats Fraud Allegations Which Results In Discharge Of Debt

On March 31, 2015, the Honorable Albert S. Dabrowski issued a decision in Hamrah v. Coulette (In re Coulette), Adv. Pro. No. 13-2039, concerning the issue of whether an obligation created by a failed business investment gives...more

Seventh Circuit Says Violations of Wisconsin’s Theft-by-Contractor Statute Are Not Dischargeable in Bankruptcy

The Bankruptcy Code prevents an individual debtor from discharging certain debts, including, upon request of the creditor, debts for “fraud or defalcation while acting in a fiduciary capacity.” 11 U.S.C. § 523(a)(4). The...more

CFPB Pursues Recovery Against For-Profit College Corinthian and Relief for Its Students

Corinthian Colleges (Corinthian) announced on April 26 that it would cease operations at its remaining physical campuses. This announcement refers to the 30 or so physical campuses that Corinthian continued to operate...more

The Supreme Court Continues Stability In The Secondary Mortgage Market

On Monday, the Supreme Court reaffirmed the principle that junior “underwater” residential mortgage liens can “pass through” a bankruptcy case unaffected. In Bank of America, N.A. v. Caulkett, the Supreme Court held...more

The Supreme Court Prohibits Chapter 7 Debtors From Stripping Off Wholly Underwater Liens in Bankruptcy

On June 1, 2015, the United States Supreme Court in Bank of America, N.A. v. Caulkett, 575 U.S. ____ (2015), unanimously held that a Chapter 7 debtor cannot strip off wholly “underwater” liens secured by the debtor’s...more

Bankruptcy Beat: Jockeys Nearing Finishing Line in 25-Year Civil and Bankruptcy Litigation with their Former Business Managers

Hall of fame horse racing jockeys Laffit Pincay, Jr. and Chris McCarron first sued their former business managers, Vincent and Robert Andrews, in California District Court in 1989 for fraud, breach of fiduciary duty and other...more

Bankruptcy Beat: A Post-Divorce Judgment Stipulation That Modifies Obligations to a Former Spouse Does Not Likewise Modify The...

On March 3, 2015, the Honorable Albert S. Dabrowski issued a decision in Swiatowiec v. Swiatowiec (In re Swiatowiec), Adv. Pro. No. 11-2074, concerning the issue of whether obligations to a former spouse incurred in the...more

Seventh Circuit Says Finding of Intent Must Be Explicit for Preclusive Effect in Non-Dischargeability Action

The Bankruptcy Code exempts from discharge those debts arising from willful and malicious injuries caused by the debtor. 11 U.S.C. § 523(a)(6). Because debtors have a habit of filing bankruptcy soon after a judgment for such...more

Proposed Treasury Regulations Eliminate 36-Month Testing Period as a Trigger for Reporting COD Income - Removing the Non-Payment...

On October 15, 2014, the Internal Revenue Service (IRS) and the Department of the Treasury proposed to remove the deemed 36-month non-payment testing period from the list of identifiable events that trigger the requirement to...more

CFPB highlights alleged credit reporting errors relating to discharged student loans of disabled veterans

In a new blog post, the CFPB provides credit reporting advice to service-disabled veterans who take advantage of federal student loan forgiveness available from the Department of Education for veterans who receive a 100...more

IRS Proposes Elimination of 36 Month Discharge of Indebtedness Reporting

Unless a statutory exception applies, when a debt is discharged without payment being made, the debtor will have discharge of indebtedness income under Section 108 of the Code. So that the IRS is alerted to this income,...more

IRS Proposes To Eliminate ‘Confusing’ 36-Month Non-Payment Testing Period for Cancellation of Debt

The Internal Revenue Service recently proposed very well-received regulations under Section 6050P of the Internal Revenue Code (the Code) that would eliminate the requirement for financial entities to treat debt as canceled...more

Fourth Circuit Issues Reminder to Plan Proponents: Evidentiary Support is Required for Non-Debtor Releases

While a minority of circuits, such as the Ninth Circuit (see, e.g., In re Lowenschuss, 67 F.3d 1394 (9th Cir. 1995), have reasoned that bankruptcy courts lack the authority to approve non-debtor releases based on the language...more

Creditors: Delete a discharged debt from a credit report or face possible liability

A typical lender is often managing tens of thousands of accounts of all different types and in various states of financial health. So what happens when a lender, for whatever reason, fails to update credit reporting agencies...more

Bankruptcy Beat: Bankruptcy Court Applies To Collateral Estoppel To State Court Judgement For Fraud and Vexatious Litigation In...

In her first published decision, rendered in Mexico Construction and Paving v. Thompson (In re Thompson), Case No. 11-32924, Adv. Pro. No. 12-03065 (Bankr. D. Conn May 22, 2014), Judge Julie A. Manning held on the basis of...more

Connecticut District Court Affirms Ruling that Collateral Estoppel Effect of California Judgments for Fraud Established Them as...

Debts based on fraud are not dischargeable in bankruptcy, but to achieve that result the aggrieved creditor must ordinarily commence a non-dischargeability action and prove the fraud. However, when an action for fraud is...more

File your taxes on time. That's an order!

OK, so I was kidding a bit, but not much. Notice that I didn't say that you needed to pay those taxes (maybe you can't), but you need to file them on time. The point is, in the event that later on you consider filing...more

IRS Provides Discharge of Indebtedness Safe Harbor for Debt Secured by Interest in Disregarded Entity Holding Real Property

In general, discharge of indebtedness income is excluded from the gross income of a taxpayer (other than a C corporation) if the indebtedness is qualified real property business indebtedness (QRPBI). To qualify as QRPBI, the...more

Pledge Of LLC Interest Enough For Avoiding Income On Indebtedness Discharge

Code §108(a)(1)(D) avoids debt discharge income to taxpayers (other than C corporations) when indebtedness is forgiven if it is qualified real property business indebtedness. This is generally indebtedness incurred in...more

Chapter 20 in the Eleventh Circuit: Modification of Secured Claims Impermissible Without Discharge

Nearly a year ago to the day, we published a post regarding the uncertainty that bankruptcy practitioners and lenders faced when a Chapter 7 debtor received a discharge, and subsequently filed a Chapter 13 petition to strip...more

Third Circuit Holds FDPCA Can Apply in Bankruptcy Proceedings

The United States Circuit Court for the Third Circuit upheld a lower court’s decision that the Bankruptcy Code precluded a borrowers’ claims under the Fair Debt Collection Practices Act. After filing for bankruptcy,...more

Is “Inadvertence” a Good Excuse When a Debtor Fails to List a Pending Lawsuit Among the Bankruptcy Estate Assets? Maybe So.

Earlier this year, the Ninth Circuit issued an opinion that caused a stir among bankruptcy law aficionados. In Ah Quin v. County of Kauai DOT, the Ninth Circuit court was faced with a bankruptcy debtor who failed to list her...more

Mechanics' Lien Trust Fund Debts Not Dischargeable in Bankruptcy – What Were You Thinking?

In a recent unanimous decision, the United States Supreme Court made it more difficult to avoid a bankruptcy debtor discharging a debt tied to "defalcation while acting in a fiduciary capacity." In Bullock, the Court stated...more

Rogers Towers: Discharge and the Unscheduled Debt: Discharge Requires Due Process

Often referred to as the “holy grail” of bankruptcy law, a bankruptcy discharge releases the debtor from personal liability for certain specified types of debts....more

35 Results
|
View per page
Page: of 2

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
×