Does bankruptcy stop criminal proceedings?

No. Under Section 362(b)(1), the automatic stay does not apply to the commencement or continuation of a criminal action or proceeding against the debtor. Criminal cases proceed regardless of the bankruptcy filing. This includes criminal contempt proceedings and criminal fraud prosecutions.

Does bankruptcy stop child support collection?

No. Domestic support obligations -- child support and alimony -- are exempt from the automatic stay under Section 362(b)(2). Collection of domestic support from property that is not property of the estate can continue. Establishment and modification of support orders also proceed without interruption.

Does bankruptcy stop an eviction if my landlord already has a judgment?

Generally no. Under Section 362(b)(22), if the landlord obtained a judgment for possession before the bankruptcy was filed, the automatic stay does not prevent the landlord from proceeding with the eviction. The debtor may be able to extend protection by filing a certification under Section 362(l) and paying any rent that comes due within 30 days, but only in narrow circumstances involving the right to cure under applicable state law.

Does bankruptcy stop a tax audit?

The automatic stay stops tax collection but generally does not stop tax assessment or audit. Under Section 362(b)(9), the IRS can continue to assess taxes, issue deficiency notices, demand filing of tax returns, and conduct audits. However, they cannot levy, seize property, or garnish wages to collect taxes while the stay is in effect.

Exceptions to the Automatic Stay -- What Bankruptcy Does NOT Stop

The stay does not stop everything

While the automatic stay stops most creditor collection activity, Congress carved out specific exceptions in Section 362(b). These reflect policy decisions that certain proceedings are too important to pause -- criminal justice, child support, public safety, and certain regulatory functions.

If your situation involves one of these exceptions, the stay may not help you. Understanding the boundaries is just as important as understanding the protection.

Criminal proceedings -- Section 362(b)(1)

The automatic stay does not apply to criminal actions or proceedings against the debtor. This means:

Criminal prosecutions continue regardless of the bankruptcy filing
Criminal sentencing proceeds
Probation and parole proceedings are not affected
Criminal contempt proceedings continue
Restitution orders entered as part of a criminal sentence are not stayed

Important distinction: Criminal proceedings are not stayed, but criminal fines that are essentially debt collection may be treated differently. The line between criminal enforcement and debt collection is not always clear and may depend on the specific facts.

Domestic support obligations -- Section 362(b)(2)

The stay does not stop collection of domestic support obligations -- child support and alimony. Specifically:

Establishment of paternity
Establishment or modification of a domestic support order
Collection of domestic support from property that is not property of the estate
Income withholding orders for domestic support
Reporting of overdue support to credit agencies
Interception of tax refunds for domestic support
Enforcement of medical support obligations

Note: While collection of domestic support from non-estate property continues, a creditor still cannot take property that belongs to the bankruptcy estate to satisfy domestic support. The distinction between estate and non-estate property matters here.

Tax audits and assessment -- Section 362(b)(9)

The IRS and state tax agencies can continue to assess taxes during bankruptcy. The stay stops collection, not assessment. This means:

Tax audits can proceed
The IRS can issue statutory notices of deficiency
Tax Court proceedings can continue (though some are also covered by 362(a)(8))
The IRS can demand that you file delinquent tax returns
The IRS can make tax assessments

What the IRS cannot do: levy your wages, seize your bank accounts, place liens on your property, or take any other collection action. Assessment and collection are legally distinct activities.

Certain evictions -- Sections 362(b)(22) and 362(l)

Eviction is one of the most complex areas of the automatic stay. The general rule is that filing bankruptcy pauses eviction proceedings. But BAPCPA added significant exceptions in 2005:

Pre-filing judgment for possession

Under Section 362(b)(22), if the landlord obtained a judgment for possession before the bankruptcy was filed, the stay does not prevent the landlord from proceeding with eviction.

The certification procedure -- Section 362(l)

Even when the landlord has a pre-filing judgment, the debtor may be able to temporarily extend the stay by:

Filing a certification with the bankruptcy petition stating that applicable state law permits the debtor to cure the default after the judgment
Depositing with the court clerk any rent that comes due within 30 days of filing
Actually curing the default within 30 days

If the debtor fails to file the certification, or fails to cure the default within 30 days, the stay terminates and the landlord can proceed.

Illegal substance or endangerment -- Section 362(b)(23)

The stay does not prevent eviction if the landlord's action is based on endangerment of the property or illegal use of controlled substances on the property.

Police and regulatory power -- Section 362(b)(4)

The automatic stay does not apply to actions by a governmental unit to enforce its police or regulatory power. This includes:

Environmental enforcement actions (e.g., EPA cleanup orders)
Health and safety code enforcement
Zoning enforcement
Securities regulation
Consumer protection enforcement by state attorneys general
License revocation proceedings

The test is whether the government is acting in its regulatory capacity to protect public health, safety, or welfare, versus acting as a creditor to collect money. The former is exempt; the latter is stayed.

Other notable exceptions

Pension loan repayments -- Section 362(b)(19)

Withholding from a debtor's income for repayment of a loan from an employer-sponsored pension plan (401(k), 403(b), etc.) is not stayed. The payroll deduction continues during the bankruptcy.

Securities regulatory actions -- Section 362(b)(25)

The SEC and other securities regulators can continue enforcement actions against the debtor.

Setoff by domestic and foreign banks -- Section 362(b)(17)

A swap participant, repo participant, or other financial market participant can exercise certain contractual setoff and netting rights despite the stay.

Presentment of negotiable instruments -- Section 362(b)(11)

The stay does not prevent presentment of a negotiable instrument (like a check) and the giving of notice of dishonor.

The full list: Section 362(b)

Section 362(b) contains 28 subsections listing specific exceptions to the automatic stay. The exceptions described above are the most commonly encountered. For the complete statutory text, see 11 U.S.C. Section 362 at Cornell LII.

If you are uncertain whether a specific action falls within an exception, consult a bankruptcy attorney. The exceptions are narrowly construed -- the stay applies broadly, and exceptions are read narrowly.