discharge in bankruptcy

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Discharge in Bankruptcy

The act of a bankruptcy court forgiving the debt of the person or company that has filed for bankruptcy. A discharge in bankruptcy means that the creditors have received as much as they are going to receive and that they no longer have the right to attempt to collect on debts.

discharge in bankruptcy

The release of a debtor from the payment of any and all debts except those specifically approved by a bankruptcy court.
References in periodicals archive ?
99) The amendment protected both federal and private student loans lenders from having their loan agreements discharged in bankruptcy without a showing of undue hardship.
The district court reversed and remanded the bankruptcy court and permitted the debt to be discharged in bankruptcy, thereby allowing Van Dyn Hoven to avoid personal liability for the corporation's payroll taxes.
Generally, tax debts that may be discharged in bankruptcy are income tax debts that are not recent-from returns due more than three years before the bankruptcy filing, or, for filed returns, those more than two years old.
10) In such cases, the creditor holds a claim that can be discharged in bankruptcy.
Non-opportunistic debtors benefit from filing for bankruptcy if the amount of debt discharged in bankruptcy [D.
Therefore, the taxes associated with the return are not discharged in bankruptcy.
If the client owes tax with respect to a return that was due (including extensions) within three years (or a return filed late and within two years), depending upon the circumstances, it may be advisable to delay filing the bankruptcy petition until after the three-year period (including extensions) or the two-year period, whichever is applicable, has expired, to increase the amount of tax debt that can be discharged in bankruptcy.
Signing an agreement stating that a debt cannot be discharged in bankruptcy makes the debt nondischargeable.
Under the Bankruptcy Code, Congress requires that the IRS be given certain time periods to assess and collect taxes without threat of the taxes being discharged in bankruptcy.
Some debts cannot be discharged in bankruptcy and remain a debtor's binding obligation even if the court grants a bankruptcy discharge.
Taxes can be discharged in bankruptcy in either a chapter 7 or a chapter 13 filing.
Nevertheless, BC section 522 also contains language prohibiting a creditor from offsetting any debt that has already been discharged in bankruptcy.