Can I Pay Off Alimony Over Time in a Chapter 13 Bankruptcy Case?
If you are considering a bankruptcy filing that involves debt for family support of any kind, it is essential to know that this type of debt — meaning alimony and child support — cannot be discharged in a bankruptcy case. Accordingly, if you were considering a Chapter 7 bankruptcy filing in order to have alimony or child support arrears discharged, you should know that these types of debts are always “exceptions to discharge,” and there are no exceptions to the “exception” under US bankruptcy law. However, just because you cannot have these debts discharged does not mean that you cannot get caught up on what you owe by filing for bankruptcy. In fact, a Chapter 13 bankruptcy filing may be precisely what you need.
When you file for Chapter 13 bankruptcy, you will reorganize debt and pay off certain debts in full over the period of your repayment plan. That includes past-due alimony. Our West Palm Beach bankruptcy lawyers can tell you more.
Understanding the Chapter 13 Repayment Plan
When a debtor files for Chapter 13 bankruptcy (or any other type of reorganization bankruptcy), part of the bankruptcy case involves the confirmation of a bankruptcy repayment plan. Chapter 13 repayment plans typically last three to five years, and during that time, the debtor must propose a schedule for repaying all secured debt and all unsecured priority debt — both those types of debts must be repaid in full by the culmination of the repayment plan and bankruptcy case. If the debtor has remaining unsecured nonpriority debts, those may be eligible for discharge in full or in part.
How does the repayment plan involve the repayment of past-due alimony or child support?
Family Support as a Priority Debt That Must Be Repaid
Family support debt, including alimony and child support, is considered an unsecured priority debt under bankruptcy law. As such, any family support debt that the debtor owes must be repaid in full through the terms of the repayment plan. At the end of that three to five year period, the debtor will need to be caught up on family support obligations they owe.
While alimony cannot ever be eligible for discharge in any type of individual bankruptcy case, a debtor can get caught up on family support payments through the structure of a Chapter 13 bankruptcy case.
Contact Our West Palm Beach Bankruptcy Attorneys Today
Are you currently struggling to get caught up on alimony or any other type of family support debt you owe? While you cannot have alimony or child support discharged in a bankruptcy case, you can get caught up by making payments over time through a Chapter 13 repayment plan. In addition to getting caught up on family support debt, you can also catch up on mortgage debt and auto loan debt, as well as other types of debt, while still being eligible to have some types of debt discharged. To find out more, you should get in touch with an experienced West Palm Beach bankruptcy lawyer at Kelley, Fulton, Kaplan & Eller. Contact us today for more information.
Sources:
law.cornell.edu/uscode/text/11
uscourts.gov/court-programs/bankruptcy/bankruptcy-basics/chapter-13-bankruptcy-basics
