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. However, there are a few situations when you might face jail time in connection with a debt.
A court can order you to serve some jail time if you willfully violate a court order. This can occur in many contexts—for example, a newspaper reporter refusing to turn over her sources.
In the debt context, this most frequently comes into play with court-ordered child support payments. If the person receiving the child support (for example, your ex-spouse) requests a court hearing because of your nonpayment, and the judge finds that you could have paid child support, but didn’t, the court could order jail time.
In a few states, a court can order you to make periodic payments on a debt. If you can pay some portion of the arrearage and arrange for ongoing payments, you can probably avoid jail—the judge would rather see the money paid than see you in jail not earning money. If you continue to refuse, though, you might be facing a jail term.
Refusing to pay income taxes is a crime. If you are prosecuted and convicted, you could go to jail.
A debtor’s examination is a procedure where a judgment creditor, with court approval, orders you to come to court and answer questions about your property and finances. If you don’t show up when ordered to do so, you could face jail time. (To learn more ways that judgment creditors can collect money from you, see How Creditors Enforce Judgments.)
Unfortunately, the tactic of deliberately using debtors' exams to force debtors into jail is on the upswing. To learn more, see The New Bill Collector Tactic: Jail Time.
If you’re having trouble managing your debt, are receiving harassing calls or letters from a debt collector, or have questions about a debtor's examination, consider talking to an attorney to find out about options in your particular circumstances.