How is Alimony and Child Support Treated If I File Bankruptcy in Coral Springs?

On behalf of Bankruptcy Law Firm of Clare Casas on Tuesday, September 13, 2011.

The treatment of alimony or child support in a Chapter 7 or Chapter 13 bankruptcy really turns on whether you are the person receiving the money or paying it. Neither one of these two domestic support obligations can be wiped out in either bankruptcy if you are the one paying it (and wanting to file bankruptcy). If you are paying it, you can deduct either one (or both) on the means test. If you are receiving it, you must report both as income on the means test. If your divorce settlement agreement lists any payment as a “domestic support obligation” then it cannot be wiped out in a bankruptcy by your ex-spouse trying to get rid of it.

If you are filing a Chapter 13 and owe either child support or alimony, being current on those payments (and staying current) is part of the requirement in formulating your plan payment. For example, if you are $2,000 behind on child support payments, your Chapter 13 plan must include the regular monthly payment AND it must also pay the $2,000 you are behind. By the end of the plan, you must be current on both obligations.

The short version of everything is this: If your ex-spouse files for bankruptcy protection, they cannot eliminate or discharge any domestic support obligation through a bankruptcy. If they are behind on their payments and filing Chapter 13, they are required to bring everything current while they are in bankruptcy court.

If you owe child support or alimony, a bankruptcy filing under either chapter will not eliminate these financial obligations.