April 10, 2017

The State of Michigan’s Driver Responsibility Program has been in existence for a number of years, and can result in a substantial amount of fees owed to the State. However, the State has begun a phase out of the Driver Responsibility programs and related fees.  It is important to note that not all driver responsibility fees will be affected by this phase out.  If your fees do not fall within this limited phase out window, it may still be beneficial to consider a bankruptcy to discharge the obligation and reinstate your license. 

 

The Driver Responsibility Program will officially end in October 2019.  The law will gradually step down Driver Responsibility Fees over the next few years.  However, only the Driver Responsibility Fees for points or tickets issued on or after October 1, 2015 will be reduced. Driver Responsibility Fees for points or qualifying offenses that occurred before Oct. 1, 2015 do  not qualify for a rate reduction and will not change. The amount of the rate reduction will depend upon the year in which the qualifying ticket was issued or points were accumulated. You cannot withhold a payment to take advantage of a lower discount in a subsequent year.  There are a number of other rules regarding this phase out and you should carefully review the details of the law to determine whether fees are included.

The following link to the State of Michigan provides a breakdown of the driver responsibility fees affected by the change:  http://www.michigan.gov/documents/driverresponsibility/DRFPhase-OutChart_470541_7.pdf

From a practical standpoint, the State of Michigan does not typically contest the dischargeability of the Driver Responsibility Fees in bankruptcy.  In most cases, clients have been able to restore their licenses when a bankruptcy discharges driver responsibility fees.  In most cases, a driver’s license can be reinstated following the bankruptcy (will likely require a reinstatement fee of $125), as long as there are no active suspensions or other revocations in place. 

If you would like to discuss how the Driver Responsibility Fee phase out further, or review your options with a Grand Rapids bankruptcy attorney, call us today at 616-364-2100.   If you would like to learn more about this or other bankruptcy related questions, pay us a visit at www.kalawgr.com. We look forward to hearing from you.

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