Lesson 70: Bankruptcy and Divorce
Welcome to Lesson 70 on "Bankruptcy and Divorce" in our series on Special Issues in Bankruptcy. In this lesson, we will explore the complex interplay between bankruptcy and divorce proceedings.
Understanding the Intersection
Bankruptcy and divorce are two significant life events that can sometimes coincide. Understanding how they affect each other is critical for effective legal and financial planning.
Key Aspects to Consider
- Property Division: How assets and liabilities are divided in divorce can affect bankruptcy filings.
- Automatic Stay: The automatic stay in bankruptcy can delay divorce proceedings.
- Dischargeability of Debts: Certain divorce-related debts may not be dischargeable in bankruptcy.
Property Division
When filing for bankruptcy, all assets and liabilities are included in the bankruptcy estate. During divorce, property division must be carefully considered to determine what remains part of the estate.
Property Division in Divorce
Assets and liabilities are divided between spouses.
Automatic Stay
The automatic stay provision under the Bankruptcy Code can impact ongoing divorce proceedings by halting certain actions, such as property division and support payments.
Dischargeability of Debts
Understanding which debts related to divorce can be discharged in bankruptcy is crucial. Generally, domestic support obligations like alimony and child support are not dischargeable.
Dischargeability of Divorce Debts
Some debts, like alimony, are typically non-dischargeable.
Illustrative Diagram
Practical Tips
- Consider the timing of your bankruptcy and divorce filings carefully.
- Consult both a bankruptcy attorney and a divorce attorney to navigate the complexities.
- Be mindful of the automatic stay and its implications on divorce proceedings.
- For a deeper understanding, consider reading "Understanding Bankruptcy and Divorce: Legal Perspectives".