Medical bills are the most common reason people seek bankruptcy. However, it is possible to seek protection against medical bills in bankruptcy because hospital bills are considered unsecured debt. A Chapter 7 bankruptcy is perfect in that it is the fastest and the debtor can walk away with just a few nicks and cuts, particularly some property that is not covered by the exemption and their overall credit score, which can affect their ability to to secure future loans.

Bankruptcy medical bills might be the best thing you can do to restart your financial future with a clean slate. There is a certain stigma attached to filing for bankruptcy, but it is actually a very personal matter. Your privacy is protected and you can still get on with your life instead of the misconception that you leave with just your clothes on. In some cases, you can even keep your car bankrupt.

What happens is that the court appoints a trustee who will take an inventory of your properties, determine which ones are exempt, and sell the ones that are not. The money raised from the sale will be used to pay off your creditors. To find out which properties are exempt from Chapter 7 bankruptcy, speak with an experienced bankruptcy law attorney. Some examples of property covered by exemptions are: your home, tools or equipment you use in your profession, social security, disability or unemployment benefits, or life insurance. There may be some additional exemptions depending on state law.

After filing for bankruptcy, the court orders creditors to stay away. But the law also allows creditors to prove that they are justified in collecting their debt, however the burden of proof shifts in their favor. However, bankruptcy will not eliminate all of your debts. Any bonds you owe prior to the medical emergency remain on the records and must be settled in a timely manner.

Filing medical bills in bankruptcy will not automatically exempt you from paying the IRS. There are conditions before the federal tax agency releases you. Again, see a bankruptcy attorney to explain all the gradations of the law regarding Chapter 7 bankruptcy medical bills. He may be able to protect himself from his creditors, but he can’t get away from the IRS. Federal agents can still step in even after bankruptcy and seize your property, but only if they decide you’re trying to run away from your responsibility as a taxpayer.