Bankruptcy is an incredible powerful financial tool, but even bankruptcy has its limitations, and child support payment is certainly one of the biggest. No matter which way you decide to file—for Chapter 7 or Chapter 13 bankruptcy—your outstanding child support debt is nondischargeable.
Child support is considered a priority debt in bankruptcy, so should you file for a Chapter 7 bankruptcy, your ex-spouse will be one of the first “creditors” that benefits from the liquidation of your assets. While your other debt may end up being discharged, not only will you be held responsible for the remaining back child support payments, but you will also need to keep up with current payments, as well.
Chapter 13 bankruptcy treats child support payments very similarly. Priority debts are included in the three or five year repayment plan, so your back payments will be included in that plan. Before your other debts will be discharged, however, you will need to be up-to-date on all back payments as well as current on your ongoing support payments.
While it may not seem as though bankruptcy can do much directly to ease your financial stress from child support dues, in reality, filing can still be very helpful. When you are able to eliminate your other financial stressors, such as overwhelming credit card debt, you will find that your money is freed up to attend to your true priority debt.
Being behind in your child support payments while you are already spread too thin financially can be incredibly stressful, especially because caring for your children is a top priority regardless of your finances. If you are concerned about your ability to keep up with your child support payments and are considering filing for bankruptcy, give our Phoenix, Arizona bankruptcy attorneys at Curry, Pearson & Wooten a call today at 602-258-1000 to discuss your options.