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I am going through a divorce, or have recently been divorced. Will that affect my bankruptcy case, or will
bankruptcy change anything about my divorce?

 

This is an extremely complicated question, and it would take far too long to cover all of the possible situations, so I can only offer a very general answer. Also, a divorce lawyer and a bankruptcy lawyer might look at the exact same situation and give you two completely different answers, because we have different points of view.

Unfortunately, divorce is one of the biggest causes of bankruptcy, and the reverse is also true; financial problems often lead to divorce. The main problem is that divorce law and bankruptcy law do not mix. Parts of divorce law are designed to make sure that one person pays money to the other, while parts of bankruptcy law are designed to do exactly the opposite. The Bankruptcy Code does make some allowances for this problem, by not permitting child support or some kinds of alimony to be altered or discharged.

Still, if possible, I usually advise people to get one over with before starting the other. In other words, get the divorce finalized before starting the bankruptcy, or file the bankruptcy together, get the debts discharged, and then deal with the divorce. Of course, sometimes that just won’t work. Then we just deal with it as best as we can.

If the bankruptcy is over when the divorce starts, the bankruptcy does not have to be considered at all. On the other hand, some divorces never end, especially when child support and/or alimony are still going on. Even if the divorce was finalized years ago, there might still be things to consider.

Child support payments can never be discharged or altered in any way. In a Chapter 13, ongoing payments will continue to be paid as always. The only question would be whether the child support would be paid by the Trustee through the Plan, or through a separate payroll deduction, or directly from one parent to the other. If you are behind on the child support, the ongoing payments remain the same, and the arrearage is treated as one of your debts, with priority payments.

A Chapter 7 should not affect child support payments very much. There may be a temporary break in payments right after the bankruptcy case is filed, but it should get back to normal pretty quickly.

Alimony is a much more complicated subject. Some types of alimony can be discharged and others cannot. It usually comes down to a question of whether the alimony was intended as support, or as a property settlement. Support can never be discharged, but property settlements are usually treated like any other debt. That is easy enough to say, but there is a lot of litigation in both bankruptcy court and in divorce court over which category applies an a certain case.