The National Council of State Child Support Directors resolves that:
We support the child support provisions proposed and placed on the calendar in the senate by the House of the United States Congress in Bill HR833. These provisions establish positive changes enhancing our ability to collect and enforce the child support obligations of non-custodial parents who file bankruptcy.
Presently when a parent owing child support files bankruptcy, custodial parents face numerous obstacles in collecting the child support owed their children. In many instances income-withholding orders must be terminated. Other methods for enforcing support orders must also cease. In most cases, parents cannot enforce the collection of court ordered arrearages payments. Instead, the bankruptcy plans will dictate how much and when the payments will be received. Bankruptcy practices and rules regarding support can vary from one state to another.
The House's proposed amendments significantly enhance the ability to collect current and past due support when a non-custodial parent files bankruptcy. They create the highest possible priority for repayment of past due child support obligations, while allowing for the collection of past due support payments as provided for by the support orders, and not solely by the bankruptcy plans. Income withholdings orders, a highly effective tool for the collection of support, are allowed to continue unimpeded by the filing of a bankruptcy.
The child support provisions of the House's version of the Bankruptcy Reform Act will also allow courts and agencies to maintain their use of other effective enforcement tools. Tax intercepts to collect support from the tax refunds of delinquent parents will continue. Professional and drivers licenses of parents who fail to pay child support will continue to be subject to suspension. The states will also be able to continue reporting child support debts as a blemish on delinquent parents credit records.
The House has also added additional incentives to parents to maintain their child support payments when they file bankruptcy. Certain delinquent parents that file bankruptcy would for the first time be required to be current in their support payments in order to have their bankruptcy plans confirmed. These same parents would only receive the benefit of a bankruptcy discharge if they have remained current in their child support payments while in bankruptcy.
The Bill also adds three other important provisions that aid the collection of child support from parents in bankruptcy. Child support creditors will be entitled to better notification of bankruptcy filings. Parents owed support by debtors will also be notified about the availability of state child support enforcement agencies. Lastly, the House Bill provides one clear definition for "a domestic support obligation".