Full Answer
What is a domestic support obligation?
A domestic support obligation is any debt in the nature of alimony, child support, maintenance or support. Such obligations can be considered to be domestic support obligations regardless of whether such obligations are so named domestic support obligations.
What is a domestic support obligation in a chapter 13 bankruptcy?
In a Chapter 13 bankruptcy, whether an obligation is a domestic support obligation or an obligation arising from a property division or settlement is an important consideration. In Chapter 13 bankruptcy, a domestic support obligation is deemed to be a priority claim under bankruptcy code section 507 (a) (1) (A).
Can I withhold income for domestic support in bankruptcy?
However, bankruptcy code section 362 (b) (2) (C) allows the “withholding of income that is a property of the estate or property of the debtor for payment of a domestic support obligation under a judicial or administrative order or a statute.”
Do attorney fees qualify as domestic support obligations?
The United States District Court case in the Western District of Oklahoma, Tucker v Oliver, considered whether an award of attorney fees qualifies as a domestic support obligation within the meaning of 11 USC 101 (14A), making such obligation excepted from discharge under 11 USC 523.
What are domestic support obligations?
In short, a domestic support obligation is any ongoing payment that a person is obligated to pay to their child or former spouse because of a divorce or separation.
What is debtor's declaration regarding domestic support obligations?
Part IV of the Domestic Support Obligation Form states the Debtor's Signature. By signing the Form, the Debtor is asserting under Penalty of Perjury, that the representations he has made in answering the former Parts of the Certificate, are True and Correct, to the Best of the Debtor's Knowledge and Belief.
What is domestic support obligation?
If a debt is classified as a domestic support obligation, the Chapter 13 debtor must cure any delinquencies during the course of the Chapter 13 bankruptcy. In addition, the debtor must make any ongoing, post-petition payments pursuant to the domestic support obligation.
How to determine if a debt is domestic support?
In determining whether a debt is a domestic support obligation, one should first look to the objective criteria contained in section 101, including the identity of the recipient or payee, what type of instrument created the obligation, and whether the obligation has been assigned.
How long does domestic support last in bankruptcy?
However, domestic support obligations that are assigned to a governmental unit may be paid less than the full amount, or 100%, of the obligations, in a Chapter 13 bankruptcy, provided the debtor commits all of his disposable income to the Chapter 13 plan, over a period of five years. Bankruptcy code section 523 (a) (18) governs domestic support ...
What is priority claim?
A priority claim must be paid in full pursuant to the debtor’s Chapter 13 plan under bankruptcy code section 1322 (a) (2), and a priority claim must be paid before any creditors with a lower classification of claim, such as general unsecured creditors. Other benefits accrue to a claimant holding a domestic support obligation claim in ...
What is domestic support?
Domestic support obligation is broadly defined to include any debt that accrues before or after the filing of the bankruptcy, including any interest that accrues on nay debt that is recoverable by the spouse, former spouse, or child of the debtor, or the child’s parent, legal guardian, or caretaking relative, or a governmental unit.
Can a domestic support debtor file for bankruptcy?
Additionally, the person owed the domestic support may seek the dismissal or conversion of the Chapter 13 bankruptcy if the debtor is delinquent on any post-petition domestic support obligation. Finally, the debtor will not receive a discharge in a Chapter 13 bankruptcy unless he or she is current on any such support obligations, ...
Is domestic support a non-governmental entity?
Such obligations can be considered to be domestic support obligations regardless of whether such obligations are so named domestic support obligations. If the debt is assigned to a non-governmental entity, such debt is not a domestic support obligation unless the obligation is voluntarily assigned by the spouse, former spouse, ...
What is domestic support obligation?
A “ Domestic Support Obligation ” is any debt incurred before or after a bankruptcy filing that is: owed to or recoverable by a spouse, former spouse, child or governmental unit, in the nature of alimony, maintenance or support, and.
What obligations must a debtor have after bankruptcy?
The debtor must be current on all Domestic Support Obligations incurred after the bankruptcy filing.
What is a QDRO in divorce?
The division of a debtor’s pension benefits frequently occurs in a divorce proceeding, resulting in the entry of a Qualified Domestic Relations Order (“QDRO”). Such a pension division is generally viewed as a transfer by debtor of a present interest in his pension, and as such is not a “debt” that can be discharged in bankruptcy.
Is a debtor's duty to pay attorney fees dischargeable?
A debtor’s duty to pay the following expenses are usually deemed to be in the nature of support and not dischargeable: Attorneys’ fees owed by debtor to his own lawyer are clearly dischargeable, but as a general rule, attorney’s fees owed by debtor to a former spouse’s attorney are not dischargeable if the underlying legal proceeding resulted in ...
Can a marital dispute result in bankruptcy?
It is an unfortunate fact that many marital disputes result in one party (or both) seeking bankruptcy relief, often without an adequate understanding of the limited relief available in the bankruptcy forum. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (“BAPCPA”) directly addressed issues related to the Dischargeability of Marital Debt and Support Obligations, as well as to the effect of the Automatic Stay on marital-related collection and enforcement proceedings.
Is a debtor's obligation to pay marital debts dischargeable?
pay the mortgage on former marital residence) and to hold the former spouse harmless on said debts will be non-dis chargeable if the obligation has the effect of providing support to the former spouse. A debtor’s duty to pay the following expenses are usually deemed to be in the nature of support and not dischargeable:
Can a divorce be granted without automatic stay?
In this instance, the divorce can be granted without first obtaining relief from the Automatic Stay, but the marital property cannot be divided without obtaining such relief.
What is domestic support obligation?
What Is a Domestic Support Obligation? Section 101 (14) (c) of the bankruptcy code defines a domestic support obligation as a debt owed to a debtor’s child or former spouse in the nature of alimony, maintenance, or support arising out of a court order.
What is domestic support in bankruptcy?
The law’s special protection of domestic support obligations extends throughout the bankruptcy proceeding. Whether a bankruptcy is filed as a chapter 7 liquidation or a chapter 13 repayment plan, the end result is the division of a limited amount of money among all the creditors.
Is child support considered domestic support?
For bankruptcy law purposes, only ongoing payments like alimony or child support are considered domestic support obligations. That means one-time payments resulting from divorce or another legal proceeding between former spouses are not domestic support obligations, so they aren’t always subject to the same preferential treatment.
Can ex spouses collect domestic support?
The bankruptcy code often gives special preference to domestic support orders, giving ex-spouses many rights that other creditors do not have. This preference comes up at many points during a bankruptcy proceeding. Ex-spouses may continue to collect on domestic support orders during the bankruptcy proceedings, receive payment before other unsecured ...
Can you discharge debt under Chapter 7?
Although bankruptcy law usually allows indebted people to discharge their financial obligations through liquidation sales under chapter 7 or payment plans under chapter 13, the law recognizes that not all debts are created equal.
Do secured debts have to be paid before domestic support obligations?
It’s important to note that secured debts are still paid before domestic support obligations. Thus, if the only assets a debtor owns are a house and a car still subject to mortgages or financing arrangements, the lenders may receive payment while the domestic support obligation holder does not.
Does bankruptcy affect domestic support?
In short, the filing of a bankruptcy petition does not disrupt domestic support obligation collections in the way it disrupts most other types of collections. If a debtor tries to use the automatic stay to withhold payment on a domestic support obligation, a lawyer can usually get the court to require payment.
What is a co-debtor stay?
11 U.S.C. §1301 (a) Creditors may not pursue your client on a consumer debt without first obtaining relief from stay. This does not apply to any joint debt that may have been commercial in nature.
Does automatic stay in place apply to divorce?
The automatic stay put in place to protect the debtor does not apply to your client. Creditors are free to pursue your client on any jointly held debt even though the debtor may have agreed in the divorce decree to be responsible for that debt.
Domestic Support Obligations
- Question: What distinguishes a domestic support obligation from a property settlement debt in Chapter 13? Two recent opinions out of South Dakota’s Bankruptcy Court address that question. These are companion opinions, issued about a month apart and authored by the same Bankrupt…
Qualified Domestic Relations Orders
Confirming A Chapter 13 Plan