How Bankruptcy Affects Alimony, Child Support & Divorce

Bankruptcy can be a complex and emotional process, especially when combined with the challenges of divorce, alimony, and child support obligations. For many people in Alabama facing financial difficulties, questions arise about how filing for bankruptcy might affect their family law responsibilities. 

Understanding Bankruptcy and Alimony in Alabama

Alimony is a legal obligation where one spouse pays financial support to the other following separation or divorce. It’s intended to help the lower-earning spouse maintain a reasonable standard of living.

Can Bankruptcy Eliminate Alimony Payments?

One of the most common concerns is whether bankruptcy can relieve someone from paying alimony. The answer is generally no. Alimony is classified as a domestic support obligation (DSO) under federal bankruptcy law. This means:

• Alimony Payments Are Typically Non-Dischargeable: Bankruptcy does not wipe out the requirement to pay alimony. Whether the bankruptcy filer owes past due alimony or ongoing payments, these obligations remain in force after bankruptcy.
  
• Bankruptcy Does Not Pause or Cancel Alimony: Even if you file for bankruptcy, the court expects you to continue making alimony payments as ordered by the family court.
  

Why Are Alimony Payments Treated Differently?

The law prioritizes family support obligations to protect the financial well-being of the spouse receiving support. Because alimony directly affects the recipient’s livelihood, bankruptcy protections exist to prevent debtors from using bankruptcy to avoid these payments.

What Happens if You Can’t Pay Alimony During Bankruptcy?

If you face difficulty making alimony payments due to financial hardship, bankruptcy itself does not excuse nonpayment. Instead, you may need to:

• Petition the family court for a modification of alimony based on changed financial circumstances.
  
• Communicate openly with the other party or their attorney.
  
• Seek legal advice to understand your options.
  

It’s important to address these issues through the family court system rather than relying on bankruptcy to resolve them.

How Bankruptcy Impacts Child Support Obligations in Alabama

Child support is intended to provide for a child’s basic needs, such as food, shelter, clothing, education, and healthcare.

Is Child Support Discharged in Bankruptcy?

No. Child support is also a domestic support obligation and is generally exempt from discharge in bankruptcy. This means:

• Child Support Payments Must Continue: Filing bankruptcy will not relieve you of the responsibility to pay current or past-due child support.
  
• Child Support Enforcement Is Strict: Courts and child support agencies vigorously enforce child support orders. Nonpayment can lead to wage garnishment, driver’s license suspension, contempt of court charges, or even jail time, regardless of bankruptcy status.
  

What Should You Do If You Can’t Make Child Support Payments?

If financial hardship prevents you from making child support payments:

• Contact the family court to request a modification of your child support order. Modifications require proof of significant changes in income or circumstances.
  
• Do not stop paying child support without court approval, even if you file bankruptcy.
  
• Seek help from a qualified family law attorney who can guide you through modification or enforcement proceedings.
  

Why Does Bankruptcy Protect Child Support Payments?

The law’s primary concern is the welfare of the child. Child support payments are essential for the child’s well-being and stability, so the bankruptcy system protects these payments from being discharged or avoided.

Bankruptcy and Divorce Proceedings in Alabama: What You Need to Know

Divorce itself involves dividing assets and debts, determining custody and visitation, and setting alimony and child support. When bankruptcy enters the picture, it can complicate these matters but does not replace or override family court orders.

Filing Bankruptcy Before or During Divorce

If you file bankruptcy before or while your divorce case is ongoing:

• Bankruptcy Requires Full Financial Disclosure: You must disclose all assets, debts, income, and expenses to the bankruptcy court. This information will likely be important in divorce proceedings as well.
  
• Debt Division May Be Affected: Debts discharged or reorganized in bankruptcy may no longer be collectible, which could impact how debts are divided in divorce. However, domestic support obligations like alimony and child support remain unaffected.
  
• Asset Protection: Bankruptcy exemptions may protect certain property from creditors, but the division of property in divorce will follow family law principles separate from bankruptcy exemptions.
  
• Timing Matters: Filing bankruptcy during divorce may delay proceedings or affect settlement negotiations, so it’s important to discuss timing with your attorneys.
  

Filing Bankruptcy After Divorce

If you file bankruptcy after your divorce is finalized:

• Alimony and Child Support Remain Obligations: Bankruptcy will not eliminate any existing support orders.
  
• Handling Remaining Debt: Bankruptcy may help manage debts incurred during the marriage or individually, but will not change support obligations.
  
• Modifying Support Post-Bankruptcy: To modify alimony or child support, you must petition the family court based on changed financial circumstances; bankruptcy alone is not a valid reason.
  

Practical Tips for Managing Bankruptcy and Family Law Issues in Alabama

Navigating bankruptcy while dealing with alimony, child support, or divorce requires careful planning and legal guidance. Here are some practical recommendations:

• Consult Experienced Attorneys: Since bankruptcy and family law intersect, working with lawyers familiar with both areas ensures your rights and responsibilities are fully understood and protected.
  
• Keep Open Communication: Maintain clear communication with your family law attorney, bankruptcy trustee, and, if possible, the other party to avoid misunderstandings.
  
• Prioritize Domestic Support Obligations: Continue making alimony and child support payments whenever possible to avoid enforcement actions.
  
• Seek Modifications Through Court: If financial hardship affects your ability to pay support, request formal modifications through family court rather than stopping payments abruptly.
  
• Maintain Financial Records: Keep thorough records of your income, expenses, and payments, which will be important for both bankruptcy and family court proceedings.
  
• Understand Your Rights and Protections: Familiarize yourself with federal bankruptcy laws and Alabama family law to know what protections apply to you.
  

Final Thoughts

Bankruptcy offers a way to regain control over overwhelming debt, but it does not erase the legal responsibilities of alimony, child support, or divorce orders in Alabama. Both alimony and child support are given high priority by the law and cannot typically be discharged through bankruptcy. If you are facing financial difficulties alongside family law challenges, it is essential to seek guidance from professionals experienced in both bankruptcy and family law matters.

Understanding your obligations, communicating with the courts, and planning carefully can help you manage these complex issues more effectively. For advice or assistance related to bankruptcy, alimony, child support, or divorce proceedings, you can contact Padgett & Robertson at (251) 342-0264 to discuss your specific circumstances and available options.