Sacramento Bankruptcy: How does Bankruptcy Affect Domestic Support Obligations?

Family support is an important issue in bankruptcies.  Courts recognize that people must be able to support their family members.  As a result, domestic support obligations have a high priority for repayment, ahead of other unsecured debt in a Chapter 13 case.  Only secured creditors and administrative fees are paid first.

Automatic stays are federal court orders which halt collection proceedings which are pending against you when you file for bankruptcy.  Automatic stays, however, do not halt payments which are part of your domestic support obligation but which are not a part of your estate.  Post-petition wages and pension income are not considered property and cannot be seized in a Chapter 7 case, but these assets may nevertheless be garnered to pay support obligations.

Under bankruptcy law which went into effect in October of 2005, the automatic stay no longer prevents license suspension or tax refund offset.  Likewise, establishment or modification of domestic support is excluded.  For personalized bankruptcy advice, call the Sacramento office of Sagaria Law for consultation.

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