Child Support Debt in Chapter 13 Bankruptcy
As a bankruptcy law firm, we know that child support can be incredibly high and make it difficult for people to maintain a good standard of living. If the child support payments make it impossible for someone to keep up with credit card payments and other loans, give us a call. We have the knowledge and expertise to help discharge or reduce the child support debt.
The bad news
Since the legal system considers child support to be a priority debt, one cannot eliminate it by filing for bankruptcy. It will continue to accumulate until any back debt is paid and payments become current. Owing back child support does not prevent someone from filing for bankruptcy though. People can still file bankruptcy and discharge other debts, just not the child support debt.
The good news
While someone cannot discharge or eliminate child support, it is possible to reduce the debt payments through family court. A family attorney can request a modification through the court system and achieve it by demonstrating financial hardship. The family judge will need to demonstrate the financial capacity of the person filing for bankruptcy. The family judge also needs to demonstrate that a reduction in support will not cause hardship to the other household.
It is also important to note that with other debts discharged in the bankruptcy or put onto an affordable payment plan through a Chapter 13 Bankruptcy, there will be more money in the monthly budget to make child support payments. This way, the payments will not be as difficult to meet.
Discharging a Chapter 13
When someone initially files for Chapter 13 Bankruptcy, it is necessary to go to the court and to present a plan for the structure of a repayment plan. This plan needs to include information on all outstanding debts, their balances and the current payment amounts. It also requires providing information on other expenses related to maintaining the household and a basic standard of living.
Things like rent, daycare expenses, insurance and more need to be in the plan. This plan allows the judge to see how much money will be left after meeting basic needs to cover debt payments. Since one cannot discharge the child support in the bankruptcy, it may be possible to include this amount so the payments to creditors are even lower.
We can develop a plan that helps you
Once a judge approves the plan, one will have to make the set payments for a number of years. Once one reaches the time frame and makes all payments, they will discharge the bankruptcy. This means that the debtor no longer needs to make the bankruptcy payments and the bankruptcy should be finished on the credit report.
However, if any back child support is going at this time, the discharge may not be granted. Therefore, it is important to have a plan in place for paying any back child support, even if that means paying an extra $100 a month to get any back debts cleared up.
Schedule a consultation
To discuss this in greater detail, call our office and speak with an attorney.
Note: This is for information only and does not constitute legal advice.