Filing bankruptcy is sometimes the only way to get creditors to stop harassing you, so you can begin to resolve your debt issues. While many types of debt are discharged through bankruptcy, some debts must still be repaid. In divorce or family law, there is a song that may apply:

"Going through the Big D

Don't mean Dallas Dump the

Debt and Keep the Palace"

These non-dischargeable debts vary from student loans to unpaid taxes, but where does alimony and child support fall? Let's just call them support obligations.

How Will Filing Bankruptcy Affect Support Obligations?

1. Child Support & Alimony Cannot Be Discharged

If you're filing bankruptcy and hoping that will help you avoid paying support obligations, you're going to be unpleasantly surprised. According to the U.S. Congress, certain forms of debt—such as tax liens—are considered priority debts, which means they cannot be discharged through a bankruptcy. Support obligations are also considered priority debts, so you'll still be responsible for making all overdue and future support obligations.

2. Support Obligations Are High-Priority Debts

When your attorney explains that support obligations are priority debts, they're not just trying to explain that they can't be discharged in a bankruptcy. They're also trying to explain that these claims take priority over other types of debt and must be paid before paying creditors. This means if there's a choice between making a support obligation payment or paying a credit card, make the support obligation payment.

3. An Automatic Stay Doesn’t Affect Support Obligations

Your bankruptcy lawyer may have told you not to worry about your creditors since an automatic stay will go into effect as soon as you begin the filing process. This is true and will prevent most of your creditors from continuing to harass or litigate against you, but it will not affect support obligations. If you're in the midst of a support obligation hearing, that court proceeding will still go forward. If your wages are being garnished to ensure you meet your support obligations, you should expect that practice to continue. In short, nothing that occurs as a part of the bankruptcy will affect your support obligations, so you should expect to continue to pay.

4. Assets Not Included in the Bankruptcy Can Be Used to Pay Support Obligations

Finally, you should be aware that assets that were not surrendered in the bankruptcy can still be used to cover your support obligations. In terms of a Chapter 7 bankruptcy, this primarily means any income that you earn after you have filed for bankruptcy. Since support obligations are a priority debt, the first thing you pay out of that income should be your support obligations.

5. A Support Obligation Judgment Never Goes Away 

Many claims have a statute of limitations that end the right of a creditor to collect. A violation of that limitations period may create a claim by the debtor against the creditor and its law firm under the Fair Debt Collection Practices Act (FDCPA). However, in Arizona and California, this obligation never goes away until paid. See a lawyer in your state to learn if that applies.

 

Sippel Law Firm PLLC offers real estate, bankruptcy, and estate planning services in the Kingman, AZ, area. If you’re considering filing bankruptcy, consulting with a lawyer from this firm can help you understand how to better handle your child support obligations throughout the process. To learn more about the firm’s legal team, visit their website. You can arrange a consultation by calling (928) 753-2889.