Monthly Archives: June 2008

Debtors’ Priorities v. the Code’s Priorities

Just last week yet another Judge addressed the issue of whether or not supporting healthy, able-bodied adult children at the expense of your creditors is allowable under the Bankruptcy Code.  This latest Judge joined the growing unanimously majority opinion by ruling NO.  I don’t know why there are so many opinion on the issue or why it appears to be such a shock to so many debtors and their counsel.

Frankly, the new Bankruptcy Code is very good at allowing Debtors room for expenses that are genuinely necessary.  The new Code has expanded authority for protecting retirement savings, religious tithing and providing support for elderly, chronically ill or disabled family or household members.   This last area in particular has been a huge relief.  It does not, however, extend to healthy, able-bodied adults.

This appears to be one of the areas where the new Bankruptcy Code (which is so modern it has even figured out that people routinely have cable tv and cell phone bills,) differs from contemporary modern opinion.  It allows for all expenses that are legitimately necessary, and it provides with some degree of generosity (not a lot, but you can’t have everything) for school-aged children’s educational expenses; it just ends parental support when the children cease to be children.

I hate to admit that this makes sense to me, because obviously I am missing something — it never makes sense to my clients.

Elaine

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