THE BLOG
12/11/2013 04:19 pm ET | Updated Feb 10, 2014

My Child Support Is Making My Chapter 13 Bankruptcy Tough

Huffington Post Reader Question

Dear Steve,

I was divorced 6 years ago and did not received child support for 4 and 1/2 years and gave my ex $25,000 as part of the equity in my home. I accumulated credit card debt trying to maintain the lifestyle of my kids and take care of them.

I filed chapter 13 14 months ago and my case has still not been confirmed. My current payment plan will cover over 70% of the unsecured debt. The trustee in my case is trying to take the $1000 I receive in child support and consider that disposable income. I make over the median income so I am being held to higher standards. The trustee has threatened to dismiss my case. Currently my debt is $93K and my current payment is $1045 monthly. It is not feasible to pay more than that. My next hearing is 2/5/14 and if the plan is not confirmed it could be dismissed or go to trial. I have two children ages 12 and 17. My son will be 18 on 2/15/14 and as of 6/1/2014 I will not be receiving child support for him.

If my case is dismissed what are my options? Is Clear Advantage a scam? Should I try to settle directly with creditors? Do you know of any case law regarding considering child support as disposable income?

Stephanie

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Dear Stephanie,

If you are receiving child support it is my understanding it will be counted as income, but only if you are actually getting it. On the flip side, the expenses related to supporting your children should be itemized and subtracted from your income when determining the disposable income.

I would talk to your bankruptcy attorney specifically about how your disposable income was calculated in your bankruptcy filing.

Just because you make over the median income does not mean filing a chapter 7 bankruptcy is out of the question. There are many ways around this issue.

I would suggest if you have lost confidence in your bankruptcy attorney or you would like to get a second opinion about your case, that you find another bankruptcy attorney who is licensed in your state to talk to.

You can click here to find a local bankruptcy attorney and talk to them for free about your specific situation.

You should absolutely get these issues clarified and sorted out before you try to jump around looking for other solutions.

Steve

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