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Can You Actually Go to Jail for A Bad Debt?

If you think back to the days of middle school American History classes, you may remember learning about indentured servitude. When Europe was colonizing America, many of the early colonists came overseas as indentured servants, as a way to escape the continent’s debtors’ prisons. After working on plantations in America for a period of time, the indentured servants’ debts would (theoretically) be forgiven.

Debtors’ prisons or gaols were also found throughout the United States. People who owed money were held in jail until friends or family members could come up with the amount of money that the prison owed. The prisons were so common that several signers of the Declaration of Independence and the U.S. Constitution spent time there for unpaid debts. However, by the mid-1800s the federal government and all states had abolished debtors’ prisons, and it is now illegal to jail anyone for unpaid civil debt like a past-due credit card.

This does not mean that Americans no longer go to jail for debt. While there may no longer be debtors’ prisons, people can—and do—go to jail for unpaid debt all the time. In general, people can be jailed for several reasons:

Tax Debt

People who owe money to the IRS can’t be jailed simply for having back taxes. But, people who intentionally cheat on their taxes or attempt to defraud the government can be jailed for tax evasion or fraud. State and federal governments have many more options to collect the collection of the debts owed to them, including the possibility of jail time, than do most other types of debt collectors.

Child Support

As a whole, society has decided that a parent’s most important financial obligation is to his or her children. Accordingly, family court judges have a large amount of power to enforce the payment of back child support debt. When a person owes child support, the court has the power to revoke his or her driver’s license, ask for the suspension of a professional license, create a wage deduction order, place a lien on personal property, or order jail time.

Sending a person to jail for failing to pay child support sends a powerful message. However, people do not earn much money while in jail, and it may be counterproductive to hold a parent in jail until his or her arrearages are paid. As a result, a parent may be ordered to go to work from Monday through Friday, but spend his or her weekend in jail until the debt is cleared. As you can imagine, many parents work very hard to clear out this debt and regain their free time.

Criminal Fines and Penalties

Technically, the United States Supreme Court has ruled that criminal defendants cannot be jailed for failing pay criminal fines. However, states and counties often get around this rule by assessing civil fines or penalties that must be paid as part of a person’s sentence. Failing to pay fines, fees, or costs associated with probation or parole programs, drug testing charges, or other programs or penalties that the state or county requires can lead to jail time. Often, failing to pay all of the fees associated with a criminal charge will result in the revocation of a person’s status on probation or parole, resulting in an immediate arrest warrant. 

Civil Contempt

Finally, there is a growing trend of using the civil contempt power to jail individuals for their debts. In many states, debt collectors are asking courts to order that a person be held in contempt for failing to pay a judgment. If the court agrees that the debtor is in contempt, the court has the power to issue a warrant for his or her arrest. After the arrest, the person’s bond is usually set at the exact amount of the debt that is owed.

Attorneys for debt collectors argue that the debtor is going to jail because of his or her refusal to follow a court order. Practically, however, using the contempt power to jail debtors has the effect of recreating a debtor’s prison. While this practice may have some use in cases of back child support debt, more and more states—especially those in the Midwest—are allowing debt collectors to use the contempt power to jail individuals for their regular consumer debts.

Help for Consumers

Most people will never be faced with the possibility of jail time over an unpaid debt. The best way to be sure that this never happens to you is to always take action when you are contacted by a debt collector. Even if you cannot pay right now, you may be able to defer the debt or stop debt collector harassment while you figure out a plan. Never ignore notices from debt collectors, especially if they come from a court or contain information about pending litigation.

If you are unsure about what to do with a debt that you owe, the attorneys at Loan Lawyers can help you find options. We have numerous methods to help you minimize your debt and get back on track financially. If you are being sued over a debt, we can defend your case and will work to find you a solution.

To schedule a free, no-risk consultation, contact Loan Lawyers today by calling (888) FIGHT-13 (344-4813).
  • ABC News
  • American Civil Liberties Union
  • CBS 4
  • CNN
  • Daily Business Review
  • Florida Trend's - Florida Legal Elite 2014
  • Florida Trend's - Florida Legal Elite 2014
  • National Association of Consumer Advocates
  • National Association of Consumer Bankruptcy Attorneys
  • NBC News
  • National Consumer Law Center
  • The New York Times
  • Avvo
  • Avvo
  • Avvo
  • Avvo
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