Can spousal support payments be discharged in bankruptcy if turned into a note?

Full question:

Is it possible to discharge spousal support payments which have been turned into a note with a bankruptcy filing.

• Category: Bankruptcy
• Date: 04/07/2025
• State: Texas

Answer:

Alimony payments are typically not dischargeable in bankruptcy. However, it can be unclear whether a particular payment is alimony or a property settlement, as this distinction affects dischargeability. A property settlement may be dischargeable, while support payments generally are not.

To determine the nature of the obligation, courts consider several factors:

1. Does the obligation end upon the death or remarriage of either spouse? If yes, it indicates support.
2. Is the payment made in a lump sum or installments? Installments suggest support.
3. Do the payments balance the parties' incomes? If so, they are likely for support.
4. How is the obligation described in the divorce decree? Descriptions indicating support suggest it is for support.
5. Where is the obligation placed in the decree? If under the heading of support, it indicates support.
6. Is there a separate mention of support payments? If yes, it may indicate the obligation is not for support.
7. Are there children needing support? If so, this suggests the payments are for support.
8. Is there a significant income difference between the parties? A large difference indicates support payments.
9. Were the payments considered taxable to the recipient? If so, they are likely for support.
10. Were there waivers of maintenance?

These factors help clarify whether the obligation is for support or property division.