Child Support Bankruptcy
In tough economic times, it can be difficult to keep up with all your financial obligations including utility bills, mortgage payments and child support. If you're in a rough financial patch, you've probably already considered whether bankruptcy protection might be able to help you.
Typically, past-due child support obligations are one type of debt that cannot be discharged in bankruptcy. Even still, bankruptcy may help provide enough breathing room on your finances so that you can catch up on your child support debt.
To ask a bankruptcy lawyer about your specific situation with child support debt and personal bankruptcy, please fill out this form and arrange a free, no-obligation consultation with an attorney near you.
Child Support and Chapter 7 Bankruptcy
Chapter 7 bankruptcy grants filers a complete discharge of some or all of their unsecured debts (that is, debts not attached to any property). But Chapter 7 bankruptcy is not a magic bullet. Here’s why:
- You have to qualify to file: In order to be eligible for the protection offered by Chapter 7 bankruptcy, you must pass a qualifying means test, which involves comparing your income and expenses to those of the median family of your size in your state. If you have an income lower than the median or have high enough basic expenses, you will likely qualify for Chapter 7's protection.
- Child support debt is non-dischargeable: If you do qualify for Chapter 7 protection, you cannot expect to have your child support debt excused. This is because federal bankruptcy law outlines certain non-dischargeable debts. Child support is one of them. But that doesn't mean that Chapter 7 can't help you at all…
- Chapter 7 can free up your money: Even though Chapter 7 bankruptcy won't be able to eliminate your child support obligations, it may help you in another way: by discharging other debts, it may free up enough of your money to make regular payments.
Child Support and Chapter 13 Bankruptcy
Chapter 13 bankruptcy works by giving filers three to five years to get current on overdue debts, while keeping up with any payments that come due during that period. Chapter 13 bankruptcy:
- Lets you include child support in your repayment plan: If you file under Chapter 13, you can include your child support debts as part of your repayment plan and catch up on them over time, and it will typically be given priority over any credit card debt or payday loans included in your filing.
- Works if you have a steady income: Some people fall behind on child support because of job loss or reduction. But a Chapter 13 repayment plan will only require you to pay what you can realistically afford based on your salary – and child support payments take a pretty high priority in bankruptcy court.
- Gives you protection from lawsuits: For the duration of your bankruptcy case, the automatic stay will typically protect you from collection actions, including debt collection lawsuits. This protection may give you the peace of mind you need to catch up on your debts.
Connect with a Lawyer to Learn More about Child Support in Bankruptcy
Every case is unique. If you're ready to learn more about how your child support debt might work in bankruptcy court, take a moment now to connect with a bankruptcy lawyer practicing near you.