Criminal Fines and Restitution in Bankruptcy

How does the rule on criminal fines and restitution actually work?

Bankruptcy sorts your debts into what a discharge erases and what it leaves standing. Court-imposed criminal obligations sit firmly in the second group. Official bankruptcy court notices given to every consumer filer list most fines, penalties, forfeitures, and criminal restitution obligations among the debts you may still be responsible to pay after a discharge (Bankr. E.D. La. official guidance — Chapter 7 Form Packet). The Chapter 13 discharge provision is explicit: it does not reach a debt for restitution, or a criminal fine, included in a sentence on the debtor's conviction of a crime (11 U.S.C. § 1328). A Chapter 7 discharge is granted under 11 U.S.C. § 727 and is subject to the exceptions in 11 U.S.C. § 523, which courts summarize as including debts to governmental units for fines and penalties (Bankr. N.D. Iowa official page — FAQs: Debtor). Practically, money owed to a court, a prosecutor's office, or a victim under a sentence generally stays owed.

What changes the answer?

Three things move the answer most. First, where the obligation came from: an amount imposed as part of a criminal sentence is treated differently from an ordinary contract debt or a routine civil judgment. Second, who holds it — bankruptcy court guidance describes debts to governmental units for fines and penalties as a common category of nondischargeable debt (Bankr. N.D. Iowa official page — FAQs: Debtor). Third, which chapter you file. The Chapter 13 discharge is broader than Chapter 7's for some debts, but it separately carves out restitution and criminal fines from a sentence, and also restitution or damages awarded in a civil action for willful or malicious injury that caused personal injury or death (11 U.S.C. § 1328). What does not change the answer is the size of the balance or how long ago the case was resolved; the discharge provisions do not describe an age cutoff for these obligations the way they do for certain taxes.

What does federal law say about discharging criminal fines and restitution?

Two provisions do most of the work. The Chapter 13 discharge section grants a discharge of debts provided for by the plan, except any debt for restitution, or a criminal fine, included in a sentence on the debtor's conviction of a crime (11 U.S.C. § 1328). The automatic stay section says that filing a petition does not operate as a stay of the commencement or continuation of a criminal action or proceeding against the debtor (11 U.S.C. § 362). Chapter 7 discharges are granted under 11 U.S.C. § 727, subject to the exceptions in 11 U.S.C. § 523, which is why courts tell filers that most fines, penalties, forfeitures, and criminal restitution obligations survive (U.S. Bankr. Ct. D. Alaska, The Forms Individuals and Married Couples Need to File Bankruptcy). Read together, neither consumer chapter offers a route to erase the financial terms of a criminal sentence.

Where do state or local rules differ?

Whether a criminal fine or restitution obligation can be discharged is a federal question, and the discharge provisions read the same in every state. What varies is everything around it: which court imposed the obligation, how the state collects it, whether supervision terms are tied to payment, and what your local bankruptcy court expects procedurally. Local bankruptcy rules can also intersect with a criminal record in unrelated ways. In one district, a local rule provides that the court cannot grant a discharge where there is reasonable cause to believe a homestead-exemption limitation tied to a felony conviction may apply, and requires a party with that knowledge to file a statement justifying the assertion (D. Colo. L.B.R. 4004-1). We do not publish a verified rule for how every state or municipality collects court debt. For local procedure, start with your district court's own guidance, and see your state hub for state-level detail.

What does this look like in practice?

Picture someone carrying restitution from a conviction, medical bills, and two credit cards. A Chapter 7 case could address the unsecured consumer debt while the restitution stays in place. Nothing about the filing pauses the criminal matter; bankruptcy court guidance states plainly that the automatic stay does not cover most criminal proceedings (U.S. Bankr. Ct. D. Ariz., Choosing Your Chapter: What can Bankruptcy do for you? What will it do to you?). Someone whose real problem is the pace of payments often looks at Chapter 13 instead, where a plan can provide for payments over the plan term even though the obligation is not discharged at the end (11 U.S.C. § 1328). Opening that case is not free: the Chapter 13 filing fee is $235 (28 U.S.C. § 1930(a)(1)(B)), plus a $78 administrative fee (Bankruptcy Court Miscellaneous Fee Schedule, Item 8, effective December 1, 2023).

What documents or information are involved?

Bring the paperwork that shows exactly what the court ordered, because the answer turns on the terms of the sentence rather than on how the balance feels day to day. Then list the debt anyway. Bankruptcy court guidance for filers is direct: you must list all your property and debts in the schedules you are required to file, and even if you plan to pay a particular debt outside of your bankruptcy, you must list that debt — if you do not list a debt, the debt may not be discharged (Bankr. E.D. La. official guidance — Chapter 13 Form Packet). Unsecured claims are reported on Schedule E/F, Official Form 106E/F (U.S. Bankr. Ct. D. Ariz., Instructions for Completing the Bankruptcy Petition, Schedules and Statements). Schedules are signed under penalty of perjury, so accuracy matters more than speed.

• The judgment or sentencing order that imposed the fine or restitution
• Any restitution schedule or payment order, including supervision terms tied to payment
• A current balance statement from the clerk's office or the collecting agency
• A record of payments you have already made
• Contact details for every holder of the debt, so it can be listed on your schedules

What should you ask a lawyer?

A short consultation is worth more than weeks of reading when a criminal obligation is in the mix, because the answer turns on documents someone can read quickly: the sentencing order, the payment terms, and how the balance is being collected. Court staff cannot fill that role. The clerk's office is prohibited by federal law from giving legal advice or assisting with the preparation of forms (Bankr. W.D. Ky. official guidance — Guide to Filing Bankruptcy without an Attorney), and district guidance repeats that filing without an attorney means the court expects you to follow the rules as if you had hired one (Bankr. E.D. La. official guidance — Chapter 13 Form Packet). Go in with written questions and the paperwork above, so the conversation starts with facts instead of guesses.

• Is this balance part of a criminal sentence, or a civil judgment that happens to arise from the same events?
• Which chapter fits my overall situation, given that this debt is unlikely to be discharged either way?
• Could a Chapter 13 plan provide for payments on this obligation over the plan term?
• What happens to my supervision or payment terms while a bankruptcy case is open?
• What else in my debt picture would a filing actually change?

Frequently asked questions

Can bankruptcy discharge restitution?

Generally no. The Chapter 13 discharge provision expressly excepts a debt for restitution, or a criminal fine, included in a sentence on the debtor's conviction of a crime (11 U.S.C. § 1328), and bankruptcy court notices tell Chapter 7 filers that most criminal restitution obligations survive a discharge (U.S. Bankr. Ct. D. Alaska, The Forms Individuals and Married Couples Need to File Bankruptcy).

Does filing bankruptcy stop a criminal case?

No. Filing a petition does not operate as a stay of the commencement or continuation of a criminal action or proceeding against the debtor (11 U.S.C. § 362). Court guidance says the same in plainer words: the automatic stay does not cover most criminal proceedings (U.S. Bankr. Ct. D. Ariz., Choosing Your Chapter). A bankruptcy case and a criminal case run on separate tracks.

Can Chapter 13 help with criminal fines at all?

Sometimes, on timing rather than forgiveness. A Chapter 13 discharge covers debts provided for by the plan, with restitution and criminal fines from a sentence carved out (11 U.S.C. § 1328). A plan can still provide for payments over the plan term, which is about structure and breathing room, not elimination. Whether that fits your situation is a question for a lawyer who has read your sentencing order.

What if I do not list the restitution in my bankruptcy schedules?

List it. Bankruptcy court guidance is explicit that you must list all your debts in your schedules, and that even a debt you plan to pay outside the bankruptcy must be listed, because a debt you do not list may not be discharged (Bankr. E.D. La. official guidance — Chapter 13 Form Packet). Schedules are signed under penalty of perjury.

Are traffic tickets and court fees treated the same as criminal fines?

Not automatically, and the sorting is more detailed than a single rule. Court guidance groups debts to governmental units for fines and penalties among common nondischargeable debts (Bankr. N.D. Iowa official page — FAQs: Debtor), but how a specific ticket, fee, or assessment is characterized depends on the order that created it. We do not publish a verified rule for every category, so bring the paperwork to a lawyer.

Does a discharge remove a lien tied to a court debt?

A discharge order relieves the debtor of the personal obligation to pay a discharged debt; valid liens against property that existed before the filing generally pass through the bankruptcy unaffected, though some liens may be avoidable or satisfied through a plan (Bankr. N.D. Iowa official page — FAQs: Debtor). Where the underlying debt is not discharged at all, that limitation matters even more.

Sources

• 11 U.S.C. § 1328 — Discharge (Chapter 13) · official source
• 11 U.S.C. § 523 — Exceptions to discharge · official source
• 11 U.S.C. § 727 — Discharge (Chapter 7) · official source
• 11 U.S.C. § 362 — Automatic stay · official source
• 28 U.S.C. § 1930(a)(1)(B) — Chapter 13 filing fee
• Bankruptcy Court Miscellaneous Fee Schedule, Item 8 — Administrative fee
• Bankr. E.D. La. official guidance — Chapter 7 Form Packet
• Bankr. E.D. La. official guidance — Chapter 13 Form Packet
• Bankr. N.D. Iowa official page — FAQs: Debtor
• U.S. Bankr. Ct. D. Alaska, The Forms Individuals and Married Couples Need to File Bankruptcy
• U.S. Bankr. Ct. D. Ariz., Choosing Your Chapter: What can Bankruptcy do for you? What will it do to you?
• U.S. Bankr. Ct. D. Ariz., Instructions for Completing the Bankruptcy Petition, Schedules and Statements
• Bankr. W.D. Ky. official guidance — Guide to Filing Bankruptcy without an Attorney
• D. Colo. L.B.R. 4004-1

Related

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• The automatic stay
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• Chapter 7
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