You Can't Discharge Court Ordered Support in Bankruptcy
In today’s economy, many people going through a divorce are also facing bankruptcy. One question I hear often is what role bankruptcy plays in court ordered support. Seems some think that bankruptcy will help them avoid paying spousal support or child support while others fear losing spousal or child support. The good news is, bankruptcy does not cover court ordered support payments.
If you are facing bankruptcy below are the facts as far as any court ordered support:
- An order for support handed down by the court is not dischargeable in a Chapter 7 or Chapter 13 bankruptcy.
- Court ordered support is a debt owed or recoverable by an ex-spouse, child, guardian or representative. Such orders include, spousal support, child support, money owed for state assistance. Also included are debts that came about via a property settlement agreement.
- Also non-dischargeable in a Chapter 7 is any debt to a spouse, former spouse, or child not described above that is incurred by the debtor in the course of a divorce or separation or in connection with a separation agreement, divorce decree, or other order of a court of record. Any debt falling under this section may be dischargeable in a Chapter 13 debt adjustment, however.
- Court ordered support is a number one priority for repayment in a Chapter 13 bankruptcy or when funds are available in a Chapter 7 bankruptcy.
