Are My Traffic Tickets Dischargeable in Bankruptcy?
Are Government Fines Dischargeable in Bankruptcy
Chapter 7 Bankruptcy
Chapter 7 bankruptcy will relive Debtors of most unsecured non priority debts. This includes credit cards, unsecured personal loans, medical bills, and late service fees. One question that comes up many times is whether traffic tickets or government fines are dischargeable because they are not student loans or taxes and they are not secured on any property.
Section 532(a)(7) of the Bankruptcy Code
Unfortunately, like taxes or student loans, government fines are not dischageable in Chapter 7. Moreover, there are not exceptions to their dischargeability like in the cases of taxes and student loans. Section 523 (a)7 of the United States Bankruptcy Code states that a Debtor does not receive a discharge from debt if the debt is a fine, penalty or forfeiture payable to and for the benefit of a government unit.
Simply put, government fines do not go away, ever. Therefore, the lesson here is to always pay your parking tickets and traffic violations. Do not let the interest and fees get out of hand, because they could potentially never go away in Chapter 7
Chapter 13 and Section 1328(a”)
On the other hand. In a Chapter 13, if the person filing for bankruptcy completes, their Chapter 13 plan, Bankruptcy Code Section 1328(a) specifically allows for the discharge of debt as stated in the above Section 523(a)(7). In other words, your traffic violation or government fine will be discharged if your complete your Chapter 13 payment plan, unless your government fine is for “Restitution, or a criminal fine, included in a sentence on the… conviction of a crime;… or damages, awarded in a civil action…as a result of willful or malicious injury…that caused personal injury to an individual or death of an individual”.