February 10, 2021
Summary: Although the debtors' prison is mostly a relic of the past, it's still possible to go to jail for your debt. Find out if you're at risk and what you can do about it.
One way that debt collectors violate the FDCPA (Federal Debt Collection Practices Act) is by threatening jail time. This is illegal because typically you cannot go to jail for debt. Although going to jail debt was once a common occurrence, debtors' prisons are no longer as prevalent as they once were. Despite this, there are some states where you can go to jail for debt or certain situations in which you can face jail time related to debt.
Around 30% of U.S. states allow borrowers to go to jail for debt. The sequence of being arrested for debt goes as follows:
Although the debt is the main reason that you are being sentenced to jail time, you are actually going to jail for debt for one of two reasons:
Laws vary from state to state, but in general, you can be put in jail for debt in the following states:
Plain and simple, you can go to jail for a debt due to two general reasons: taxes and child support. This is because different types of debt are considered different crimes. If you owe taxes and haven't paid them, this is considered tax fraud. Otherwise, the main reason you can go to jail for debt in all states is for failure to pay court-ordered child support.
One main reason you can go to jail for debt is for willfully violating a court order. When it comes to debt, this might include your child's other parent suing you for child support payments or a debt collector suing you for unpaid debt.
In some states, you may be allowed to make periodic payments on a debt. This means that you can pay a portion of your debt and then pledge to continue those payments. If you choose to do this arrangement you will most likely avoid going to jail. Jail is the last resort in an attempt to force you to make the payments. If you continue to refuse these payments, you may see yourself looking at jail time in a debt jail state.
Income tax is considered a debt until paid, and not paying income taxes is a serious crime. If you are prosecuted for refusing to pay income taxes (and you are convicted) then you have a chance to go to jail.
The debtor's examination is an event where a creditor will order you to come to court. This is after obtaining a judgment and must go through the court. During this time you will need to answer in court questions regarding your finances and why you are not paying the debt. If you do not show up, this can lead to jail time in 30% of U.S states. It is somewhat rare to be sentenced to jail for debt, but it is legal in certain jurisdictions.
In most states, you can go to jail for failure to pay debt such as credit card and hospital fees under a warrant of failure to comply with a court order. In this case, the court can issue a warrant for your arrest, and then you will need to pay a bond to get out of jail. This bond is typically the same amount that you originally owed to the creditor. Having said that, in six states you cannot go to jail for a debt of any kind, regardless of if in contempt of court to pay it.
These six states include:
If you are unable to pay a debt and you receive a summons, you need to know your rights. Debt collectors and creditors are not allowed to threaten you with jail time, because they cannot legally enforce that. Only a judge can sentence you to debt. Debt collectors and creditors may also not harass you, or call you at odd hours, nor tell anyone other than your spouse about your debt. Legally you have a right to be treated fairly and legally.
If you do get a notice that a lender or debt collection agency has sued you, then the first step you must take is to respond. This will allow you to ask the debt collector for proof of the debt, and force them to show it. Some creditors or debt collectors offer a financial hardship program but forcing them to prove you owe the debt is essentially challenging it.
If a court summons you, go to the hearing. If you comply with all court requests, then you cannot go to jail. Most often a judge will work with you rather than immediately send you to jail. If the debt is old, you can also request to find out whether or not the statute of limitations has passed.
Overall, there are many options and steps you can take. Although legal in some states, going to jail for debt is not common and can be avoided.
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Here's a list of guides for other states.
Being sued by a different debt collector? We're making guides on how to beat each one.
Need more info on statutes of limitations? Read our 50-state guide.
Need help managing your finances? Check out these resources.