Domestic Support Obligation and Bankruptcy
What is domestic support obligation?According to the bankruptcy law, domestic support obligation is referred to any debt that has happened before or after filing bankruptcy, or a debt that is owed or able to be regained from a spouse, former spouse, child or governmental organization. Often when facing these domestic support and bankruptcy, many questions are raised and often people do not know where to turn for efficient answers. Below are questions regarding domestic support obligations that have been answered by the Experts.
In the case of filing bankruptcy is child support considered protected or unprotected along with a car and what is its main concern for the back taxes?Child support will be listed on the Schedule E for Creditors Holding Unsecured Priority Claims. This is considered a Domestic Support obligation, and the individual can find this at the top of the page. As for the car, the care is considered a Secured Debt and this will be filed under Schedule D. Now, if the individual has a car loan this too will be filed under the Schedule D forms whether or not the individual is planning on paying the car loan off. In these cases Domestic Support obligation debt will be considered a higher concern than Tax debt. Domestic Support obligation debt is considered the number one priority, and tax debt is to be considered number eight, this information is stated in the Bankruptcy Statute 507(A).
If an ex spouse has filed chapter 13 bankruptcy and did not list their former spouse under the domestic support obligation, is that legal?In this case the money that their ex spouse owes them will be considered “Priority Debts”. What this mean is that this individual will have the ability to be paid before all other unprotected debts, and will receive more than likely more than $250 a month. This type of debt should be listed under the Schedule E form, where their ex spouse could also point out that the debt is in disagreement. Some believe that the easiest way to correct this is to show up to the Creditors Meeting, and they can state that the Bankruptcy trustee of that person has made an error.
In the state of New Jersey if an former spouse has filed Chapter 7 bankruptcy what will happen to the money that that person owes for back child support, college expenses and past medical bills?Domestic support obligations are not able to be considered released in Bankruptcy this is recorded from the Bankruptcy Statute 523(a) (5). What this means is that any amount of money that is still owed to the other spouse because of a domestic support obligation will not allowed to concern them because of their former spouse’s bankruptcy. Also, anything that the individual who had filed bankruptcy owes the other spouse because of a divorce order, whether or not the concern was domestic support obligation, this is also not allowed to be released under the Chapter 7 Bankruptcy, and this also will not affect the innocent spouse because of the bankruptcy filing. All of the above stated rules not only apply to the Chapter 7 but also for the Chapter 11.
When filing for bankruptcy chapter 7, and the individual does have a child support obligation, but is current on all their payments, do they still need to check “domestic support obligations” on Schedule E even though they are current on their child support?In this case child support obligation, along with other domestic support obligation such as alimony if that is related should in fact be listed upon the Schedule E form. Also, this is not restricted in the many cases where the individual still owes support payments.
When your spouse has filed bankruptcy to take care of their unpaid debts a lot of times will leave can people worried that their employment checks can and will be taken in order to take care of this problem. A lot of time bankruptcy will lead many couples to divorce and the same concern may come up. Many individuals are lucky enough to get granted domestic support obligation, where their lives and employment checks are not affected by what their former spouse has done. For more information relating to the domestic support obligation in bankruptcy contact the Legal Experts online.