| Bankruptcy and Domestic Support Obligations |
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| Written by Alan Alder |
| Tuesday, 04 August 2009 08:33 |
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Federal bankruptcy law recognizes an important class of debts known as domestic support obligations. In considering filing for relief under the bankruptcy code it is important to determine what constitutes a domestic support obligation and its potential effect on your bankruptcy.
Federal bankruptcy law recognizes an important class of debts known as domestic support obligations. In considering filing for relief under the bankruptcy code it is important to determine what constitutes a domestic support obligation and its potential effect on your bankruptcy. Under the bankruptcy code it does not matter when the domestic support obligation became due. It can be a debt that accrued before you filed bankruptcy or after you filed bankruptcy. Interest is also included in the obligation. A domestic support obligation must be owed to a spouse, former spouse, or child of the debtor or the child's parent, legal guardian, or responsible relative. The obligation can also be owed to a governmental agency. For a debt to constitute a domestic support obligation it must be a debt owed on the basis of alimony, maintenance, or support of a current spouse, former spouse, or child of the debtor or the child's parent. The term or terms applied to the debt are unimportant in determining if the debt is a domestic support obligation. Domestic support obligations must have been established or subject to establishment before, on, or after filing bankruptcy, by reason of a property settlement agreement, divorce decree, separation agreement, or by an order of a court of record. No debt will be treated as a domestic support obligation if it is assigned to a nongovernmental agency unless the obligation is assigned voluntarily and assigned solely for the purpose of collection the obligation. When you file a bankruptcy no automatic stay goes into effect with respect to domestic support obligations. Garnishments, court orders, collection efforts, etc. can continue as they relate to any domestic support obligation. There can be no discharge of a domestic support obligation in a Chapter 7 or Chapter 13 bankruptcy. A Chapter 13 Plan must provide for priority payments for domestic support obligations. If you have identified that you owe domestic support obligations it is important to recognize that bankruptcy will not stop your obligation to pay those debts. If you have fallen behind on your domestic support obligations it may mean that a Chapter 13 is not a viable alternative for you since the domestic support arrears must be paid in its entirety under the Chapter 13 plan. DISCLAIMER: This article is provided as information only and is not to be taken as financial advice. Before you file bankruptcy or seek any debt solution alternatives, make sure you check out the site of Murfreesboro bankruptcy attorney Alan Alder. Mr. Alder is a Gallatin Chapter 7 bankruptcy attorney and is eager to answer your questions. |