As many divorced and separated parents know, child support can represent a significant expense on a monthly basis. The impact of child support payments becomes magnified if you are facing considerable financial strain, whether it’s due to medical bills, losing your job or experiencing any number of other unexpected challenges.
One benefit of bankruptcy is that it creates an automatic stay which stops a creditor from collecting any debts until the case has been finalized. However, child support is deemed a non-dischargeable debt so it can not be eliminated in a bankruptcy proceeding.
Therefore, you will need to continue to make child support payments despite being in bankruptcy. Any unpaid child support will not be cleared as a result of the bankruptcy. All parents must, by law, support their children financially. That responsibility is not changed by filing for bankruptcy.
If you are falling behind on your child support payments, it’s important to let the recipient know right away. You may be able to seek a modification to your original child support order to adjust the amount of money you must pay each month. This can be easier said than done, but is often worth trying. A modification can only be made through the court changing the support order, however.
The following are summaries on how the two most common types of personal bankruptcy affect child support payments.
While the automatic stay that comes with Chapter 7 bankruptcy will stop most of your other creditors from coming after you, it does not apply to child support. You may still be subject to collections from assets or property that’s not part of your bankruptcy estate.
Any property you acquired after you filed for bankruptcy, including the wages you earned after filing, is not part of your bankruptcy estate. Therefore, those wages can be garnished for child support purposes, even if you have an ongoing Chapter 7 bankruptcy.
Chapter 13 bankruptcy also does not discharge your child support obligations. However, you may use it to get caught up on the payments you currently owe. You will need to stay on top of your regular ongoing payments to make this happen.
This can actually be beneficial to you in your Chapter 13 case, as paying child support can reduce the amount of money you need to pay back to any unsecured creditors. As long as you continue to make timely payments on your Chapter 13 plan and stay up to date with your current child support payments, you will not need to worry about separate actions made for the purposes of collecting money outside of bankruptcy.
To learn more about the debts you can and cannot discharge when you file for bankruptcy in Georgia, work with an attorney at Jeff Field & Associates. Call the firm at 404-381-1278 or contact us online to set up a free initial consultation.
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