Some are so specialized that it's unlikely that they'll be a part of your case. By contrast, frequently used priority claims include domestic support obligations and non-dischargeable tax debt, and it's likely that you'll find a wage and customer deposit claim in a small business bankruptcy.
Priority claims get paid according to their order of importance. The bankruptcy trustee --the official responsible for managing your case--will fully pay higher ranking claims before moving on to the next claim category.
The following is a list of the ten categories of priority claims, along with a brief explanation about each type.
Claims for capital requirements due to a federal depository institution. This specialized category gives priority to claims of banks against people or businesses who are required to maintain the capital reserves of the bank.
If these claims are not paid in full in the Chapter 7 bankruptcy, you will continue to owe them even after you receive your discharge. Chapter 13 bankruptcy. In this chapter, all priority claims must get paid in full through the plan. For instance, your plan payment will have to be sufficient to pay all of your back child support, taxes, ...
Not all are used regularly, however. Some are so specialized that it's unlikely that they'll be a part of your case. By contrast, frequently used priority claims include domestic support obligations and non-dischargeable tax debt, and it's likely that you'll find a wage and customer deposit claim in a small business bankruptcy.
When you file for Chapter 7 bankruptcy, not all creditors are treated equally. Bankruptcy law sets out the order in which creditors get paid and gives certain claims priority over others. In this article, you'll learn about how priority claims get paid in Chapter 7 and 13 bankruptcy cases. (To learn more about how Chapter 7 works, see our Chapter 7 ...