Dischargeability of Criminal Restitution

People who are ordered to make financial restitution to crime victims sometimes inquire whether or not court ordered restitution is dischargeable in bankruptcy. The bankruptcy law amended the provisions for Chapter 13 to make all restitution non-dischargeable. Chapter 7 bankruptcy has different rules depending upon whether restitution is payable to the state or to private parties. A debtor can wipe out in Chapter 7 bankruptcy restitution debt ordered by a state court owed to a private party who was victim of the debtor’s prior criminal act. However, any restitution payable "to and for the benefit" of a governmental office cannot be discharged in either Chapter 7 or Chapter 13. If restitution to a private party is a condition of probation, it is possible that the state court may be able to revoke probation if restitution is not paid after filing Chapter 7.