What An Automatic Stay Does Not Prevent

There are some instances in which an automatic stay won’t help you. Here are a few:

Certain tax proceedings. The IRS is still about to audit you, issue a tax deficiency notice, demand a tax return (often leading to an audit), issue a tax assessment, or demand payment of such an assessment.  The automatic stay does stop the IRS from issuing a tax lien or from seizing your property or income.

Support actions taken against you. Filing for bankruptcy does not stop a lawsuit against you that seeks to establish paternity or to establish, modify, or collect child support or alimony.

Criminal proceedings. Criminal proceedings that can be broken down into criminal and debt components will be divided. The criminal component will not be stopped by the automatic stay. (Example, if you have been convicted of writing a bad check, sentenced to community service, and ordered to pay a fine, your obligation to do community service will not be stopped by your filing for bankruptcy).

Loans from pension. Money to repay a loan from certain types of pensions, this includes most job-related pensions and IRAs, can still be withheld from your income despite the automatic stay.

Multiple filings. The stay automatically terminates after 30 days unless you, the trustee, the U.S. Trustee, or a creditor asks for the stay to continue if you had a bankruptcy case pending during the previous year. It will have to be proven that the current case was filed in good faith. But If a creditor had a motion to lift the stay pending during the previous case, the court will presume that you acted in bad faith. You will have to overcome this presumption in order to get the protection of the stay in your current case.