There are situations in which you can, and can’t, be arrested for debt. Let’s explore.

Approximately three-quarters of American adults are in debt. There are many different types of debt in the US, but in 2021, mortgages and credit card debt made up about 43% of all consumer debt. This statistic shows that personal debt in the United States has been steadily increasing. In economics, the term “personal debt,” which is akin to “consumer debt,” is used to refer to consumers’ outstanding debt. It consists of personal debts incurred because of buying goods for consumption by oneself or by one’s household. It includes loans taken out to buy consumable items with no future value appreciation.

If you are struggling to pay off credit card debt or other unmanageable bills, you may start receiving calls from collection agencies. Furthermore, those debt collectors might use aggressive methods, such as making threats of jail time, to intimidate you into making a payment. You might be one of the many people that are asking, “Can I go to jail if I don’t pay my bills?”

Directly speaking, there are debts that, if not paid, can send you to jail. However, it will depend on the nature of the debt, the relevant laws in your state of residence, and the procedure of how you’re going to settle the debt. To give you a clearer understanding, this article will educate you with information about jail time and debt.

Brief History of Debtors Prisons

The good news is that debtors’ prisons were abolished by federal law in the US back in 1833, though many states continued the practice past the mid-century. The issue remained concerning enough that the US Supreme Court had to reaffirm the unconstitutionality of imprisoning someone for debt as recently as 1983.

So, what’s the bad news? Unfortunately, ending up in jail due to unpaid debts still happens even today. Although much of it revolves around the recently developed “offender-funded” justice system in many states, jail time ultimately resulting from unpaid debts can happen just about anywhere in the US.

Types of Personal Debts

To better understand whether you can be jailed for not paying your debt in America, it is best to understand the various types of debt. This will make it clearer to you what kind of debt you are dealing with. There are three main types of personal debt:

• Unsecured debt: These types of debts have no collateral, meaning the borrower puts up nothing of monetary value other than their signature and their credit reputation. Without a guarantee of payment, the lender relies completely on the borrower’s ability to pay them back on the loan. Sometimes, the two parties will enter into an agreement with a written contract, obligating the borrower to pay back the loan. If they don’t, the lender can file a lawsuit against the borrower for the unpaid debts. Such judgments often result in wage garnishments and not jail time. Unsecured debts often have higher interest rates because the lender is taking on a high level of risk. Examples of this type of loan include credit card debt, medical bills, store cards, payday loans, signature loans, and membership bills. Unsecured debts can be revolving debts (like credit cards that allow you to continuously pay down a balance and then borrow against the credit limit) or installment debts (like a personal loan that requires a set monthly payment and has a fixed payoff date at the end of the loan).
• Secured debt: This type of debt is secured by collateral. A collateral or an asset is promised to the lender if the borrower does not pay back the loan. If the borrower can’t pay the loan, lenders may choose to seize assets as repayment. Secured debt can be revolving (such as a home equity line of credit), although most are installment loans.

What Sort of Debts Are Punishable by Jail Time?

There are some debts in particular that if unpaid, can lead to a legal process and jail time if you remain uncooperative with the courts.

Child Support Debt

Child support is a court-ordered payment; you should abide by any orders issued by the court. “Contempt of court” is a legal term that denotes disobeying a court order, and it is a common reason why those who do not pay a debt (e.g. back child support) can be sent to jail. Depending on the circumstances, violating federal law regarding child support payments could result in a sentence of six months to two years in prison.

Tax Debt

If you intentionally lie to the IRS to avoid paying taxes, you risk going to jail. You risk the IRS suing you if you don’t pay your taxes. You’ll be subject to some sort of fines or fee collection if you keep accruing IRS debt.

Additionally, the IRS could file a lawsuit against you to recover any unpaid taxes if you make a mistake and are under audit. You might even deal with a tax lien, where your home or vehicle could be taken to pay off your debts. However, despite how unpleasant they may be, all of these situations would be civil proceedings. You might end up in jail if you refuse to cooperate with the civil case.

Contempt of a Court Order Debts

Contempt of Court Debts are debts with legal obligations that, if not paid, may result in legal action. These are debts that have legal contracts that state if you can’t pay the debt, it will be brought to court to determine how you’re going to settle the debt. Lenders can file a lawsuit against you and successfully obtain a monetary judgment before they can collect an unpaid debt that is not secured by collateral. Compared to secured debt, if you can’t pay the debt, the collateral will be the payment, thus, no need for the issue to be brought to court.

However, you may be found in contempt of court if you receive a notice to appear in court because a lender has filed a lawsuit against you and you choose to ignore or disobey that civil court order. When that happens, the civil case may turn into a criminal case, and a warrant for your arrest may be issued.

Rent-to-Own Leases

While not technically a debt, payments missed on rent-to-own contracts have landed many consumers in jail over the past decade or so. Many, if not most, contracts allow for the repossession of the leased appliance, piece of furniture, or electronics the minute after the payment is missed. If you do not allow the company to remove the item, courts in most states may now consider you as having committed theft of the property. That means you can now be subject to arrest.

Bottom Line

Just because you’re behind on payments on your bills doesn’t mean you can be arrested for debt. No consumer debtor, including one who owes money on credit cards, medical bills, payday loans, mortgages, or student loans, should be arrested. However, your creditors have the right to sue you in civil court for an unpaid debt, which could result in an indirect debt-related arrest. In other words, while not paying a debt won’t get you arrested, it may get you a court order to pay it. If you refuse to comply with the court’s order to pay the debt, your refusal to comply with the court order may result in your arrest.

If you receive any kind of court notice, do not disregard it — even if you are not familiar with the company that is suing you. Aside from potential legal issues, missing the appointment or failing to follow the notice’s instructions means you’ve lost the chance to argue your case, settle the debt, or work out a payment arrangement. As a result, it’s imperative to respond to a court summons and work with them to pay any fines or other payments that may be due.

Can You Go to Jail for Not Paying Medical Bills?

Can I go to jail if I don’t pay my debts?

Debtors’ prisons are a thing of the past; usually, you can’t go to jail just because you don’t pay your debts or bills. But in a few situations, you might face jail time in connection with a debt, like if you: you don’t appear for a debtor’s examination. A court can order you to serve some jail time if you willfully violate a court order.

What happens if I don’t pay my court fees?

If you don’t pay your court fines, fees and costs on time, courts can hold you in contempt of court. This could put you back in jail or prison. You can also find yourself facing additional fines, fees and costs for late payments as well. And this is on top of any interest the court might charge you as well. Criminal convictions come with costs.

What if I can’t pay my medical bills?

Unpaid medical bills can lead to calls from debt collectors, dings to your credit report, and potentially bankruptcy. If you can’t pay your medical debt, you can ask for a payment plan that’s affordable for you, find financial assistance programs, or consolidate the debt. Some organizations offer grants to help you pay medical debt.

Can you go to jail if you don’t pay a fine?

The key U.S. Supreme Court ruling dealing with unpaid fines says that only defendants who have money and refuse to pay can be sentenced to jail for violating the court’s order to pay the fine. ( Bearden v. Georgia, 461 U.S. 660 (1983).) Judges should not jail defendants if they are unable to pay. Defend your rights.