Among the stresses and worries that pile up when you’re fighting debt, you might wonder whether imprisonment is among them. Fortunately, debtors’ prisons are a thing of the past, but there are a few very unique situations in which you can still go to jail for not paying up. Before you panic, though, realize that these situations are few and far between. To put your mind at ease, we will walk through them here.
Willful Violation of a Court Order
A court of law can order you to serve jail time if you willfully (intentionally and deliberately) violate an order. In the debt context, this occurs most frequently when it comes to court-ordered child support payments. In other words, if you consistently and deliberately fail to make court-ordered payments to your ex-spouse, you might serve some time. The specific rules, however, will vary from state to state. In some states, a judge might order you to make periodic payments to your ex, potentially saving you from a jail term.
Refusal to Pay Income Taxes
The IRS historically isn’t the most forgiving entity out there, so you could face jail time for failing to pay your income taxes – that is, if you’re prosecuted and ultimately convicted for your nonpayment.
Failing to Appear for a Debtor’s Examination
A debtor’s exam is a procedure in which a creditor seeks court approval to demand your presence in court to discuss your financial situation. If you fail to show, you could face a jail sentence.
What about Student Loans, Medical Bills, and Credit Cards?
Expenses like student loan payments, medical bills, and credit card balances are considered “civil” debts. You cannot be arrested for failing to pay your civil debts. You can, however, be sued – but the law forbids imprisonment for missing your healthcare, student loan, or credit card payments.
But my Debt Collector keeps Threatening to Throw me in Jail!
Debt collectors are held to certain legal standards under federal law, and among their forbidden behaviors are threatening to imprison debtors.
If a debt collector has threatened to throw you in jail, or even so much as mentioned criminal liability, you have the right to report this conduct to your state’s attorney general’s office, the Federal Trade Commission, or the Consumer Financial Protection Bureau. Do not automatically assume that because a debt collector mentioned prison, you need to fear being arrested.
[ Read more about Fair Debt Collection Practices Act ]
The Solution: Make Those Payments!
If you’re at all fearful about criminal liability for nonpayment of a debt, or if you’ve failed to show up for a debtor’s examination, your first course is to try to correct the mistake. Get current on your payments, pay your taxes, and try to set things right with your creditors. If you’re unable to avoid a warrant or criminal summons, contact a criminal defense attorney right away to help you navigate the system and hopefully get your charges dismissed.
When it comes to your civil debts, remember that you have the right to not be harassed by your creditors, but it’s also vital to pay down your debts as soon as possible to avoid their continued contact – and to get yourself back on firm financial footing. If you need assistance resolving your civil debts, contact a reputable debt relief company to help you get back on track.