Debts
What happens to unpaid utility bills in bankruptcy?
Utility bills you owed before filing are generally unsecured debts that bankruptcy can discharge. A utility may not cut off, refuse or change your service just because you filed or because that old bill went unpaid. It may, however, stop service if you do not provide a deposit or other security for future service within 20 days after you file.1 2 3
Get the Pro Se GuidePast-due bills for electricity, gas, water or similar services are treated like other unsecured debts, and bankruptcy law adds a specific protection against shutoff. This guide covers the old bill, the deposit a utility can ask for, and the bills that come after filing.
General information, not legal advice. Rules and amounts change; check with a lawyer or the court before you act.
In this guide
after filing to give the utility adequate assurance of payment for future service, such as a deposit2 3
11 U.S. Code § 366(b) (Cornell LII) and 11 U.S. Code § 301(b) (Cornell LII)
What happens to the bill you already owe?
A past-due utility bill is normally an unsecured claim, meaning the creditor holds no security for it. When you file, the automatic stay stops most collection activity, including collection calls and letters about debts from before the case.4 5
What happens next depends on the chapter.
| Question | Chapter 7 | Chapter 13 |
|---|---|---|
| The bill from before filing1 6 | Discharged with your other debts from before filing, unless an exception applies | Paid through the plan as an unsecured debt, which the plan need not pay in full |
| Shutoff because of the filing or the old bill2 | Not allowed | Not allowed |
| Deposit or other security for future service2 3 | The utility can require it within 20 days after filing | The utility can require it within 20 days after filing |
| Bills for service after filing1 | Not covered by the discharge | Not part of the debts from before filing; pay them as they come due |
Can the utility cut off your service because you filed?
No. A utility may not alter, refuse or discontinue service to you, or discriminate against you, solely because you filed bankruptcy or because you did not pay a bill for service provided before the filing.2
The word that matters is "solely". The protection is about the filing and the old debt. It is paired with a condition, described next, that lets the utility protect itself for the service it provides from now on.2
Can the utility ask for a deposit?
Yes. The utility may alter, refuse or discontinue service if, within 20 days after the order for relief, neither you nor the trustee provides adequate assurance of payment for future service, in the form of a deposit or other security. When you file a case yourself, the filing is the order for relief, so the 20 days run from your filing date.2 3
- The assurance covers service after filing. It is not a payment toward the old bill.2
- If you think the amount asked for is too high, the bankruptcy court can order a reasonable change to it, on request and after notice and a hearing.2
- The clock is short. Contact each utility you owe soon after filing, ask what it requires, and keep a record of what you provide and when.2
Is the old bill wiped out in Chapter 7 and in Chapter 13?
In Chapter 7, the discharge covers debts that arose before the case was filed unless an exception applies, and it releases you from personal liability for them.1 7
In Chapter 13, the old bill is paid through the plan with your other unsecured debts. A plan does not have to pay unsecured claims in full, and the discharge at the end covers debts the plan provided for, with limited exceptions.6 8
What about bills after you file?
They are yours to pay. The discharge reaches debts that arose before the case was filed, not service you use afterward.1
The shutoff protection is also limited to the filing itself and the bill from before it. What happens if you fall behind on new bills is outside this protection, so ask the utility or your state's utility regulator about its shutoff rules.
Common questions
Can my power be shut off because I filed bankruptcy?
Not for that reason alone. A utility may not alter, refuse or discontinue service solely because you filed or because a bill from before the filing was not paid.2
Will I have to pay a deposit?
The utility can require adequate assurance of payment for future service, in the form of a deposit or other security. If it is not provided within 20 days after the order for relief, the utility may alter, refuse or discontinue service.2
What if I cannot afford the deposit the utility asks for?
On request and after notice and a hearing, the bankruptcy court may order a reasonable change in the amount of the deposit or other security.2
Sources
Official courts & government references- 11 U.S. Code § 727(b) (Cornell LII)
- 11 U.S. Code § 366(a) (Cornell LII)
- 11 U.S. Code § 301(b) (Cornell LII)
- Glossary of Legal Terms (uscourts.gov)
- 11 U.S. Code § 362(a)(3), (a)(6) (Cornell LII)
- Chapter 13 - Bankruptcy Basics (uscourts.gov)
- Discharge in Bankruptcy - Bankruptcy Basics
- 11 U.S. Code § 1328(g)(1) (Cornell LII)