The Short Answer
No — debts assigned to you in a separation agreement, divorce decree, or other court order are almost never dischargeable in bankruptcy. Since the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA), both domestic support obligations (like alimony and child support) and property settlement debts ordered by a court are protected from discharge under 11 U.S.C. § 523(a)(5) and § 523(a)(15). It doesn't matter whether the debt is owed to your ex-spouse, your children, or a third party — if a court ordered you to pay it as part of a divorce, bankruptcy won't eliminate it. This makes it critical to carefully evaluate what you agree to before signing any separation agreement.
When the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) became effective October 17, 2005, debts ordered in a separation agreement, divorce decree or other order of the Court became non-dischargeable. This can be reviewed in detail at 11 U.S.C § 523(a)(5) and 523(a)(15). Domestic support obligations, inclusive of alimony, child support and other debts ordered to be paid by the court, cannot be eliminated in bankruptcy regardless of whether it is ordered before, during or after the date of the bankruptcy filing. In addition, the debts cannot be eliminated regardless who is owed the debt – spouse, ex-spouse, child, guardian of the child or a governmental unit. 1 U.S.C § 101(14A).
If you are in the process of a separation and divorce, it is important to understand what you are obligating yourself to pay prior to signing the paperwork. A couple of common examples are provided below:
Example One: You and your soon to be ex-spouse have a credit card with a balance of $10,000. You and your spouse incurred this debt when trying to start a business. During the negotiations of the separation agreement, you decide to take responsibility for the credit card. You feel this is the right thing to do since you pushed the development of the business. In this case, your spouse is “held harmless” for this credit card balance. As a result, you must pay this debt.
Example Two: You and your ex-spouse own a home. Your ex-spouse and two children live in the home and want to continue to live in the property. Both of your names are on the first mortgage loan but only your name is on the second mortgage. You have agreed in the divorce decree to pay the mortgages on the home until your youngest child graduates from high school. Once again, since you took responsibility for the debts under the divorce decree, you cannot file bankruptcy to eliminate the debts on the two loans. You are now solely responsible for the debt on the house.
There are obviously many examples, but these are two of the more common scenarios we see at Duncan Law. Again, it is extremely important to assess your ability to pay prior to accepting responsibility for the debt¸ since it will not be dischargeable in bankruptcy.
Key Takeaways
- Debts assigned in a separation agreement or divorce decree are non-dischargeable in both Chapter 7 and Chapter 13 bankruptcy under federal law enacted in 2005.
- Domestic support obligations — including alimony and child support — cannot be eliminated in bankruptcy regardless of when they were ordered or who receives the payments.
- If you agree in a divorce to take responsibility for a joint credit card, mortgage, or other shared debt, that obligation survives bankruptcy even if the original creditor is a bank and not your ex-spouse.
- The "hold harmless" clause in a separation agreement means you personally guaranteed protection for your ex-spouse — bankruptcy does not override that promise.
- Before signing any divorce or separation paperwork, honestly assess your ability to repay every debt you are accepting, because you will have no bankruptcy safety net for those obligations.
- Consulting a bankruptcy attorney before finalizing a separation agreement can reveal whether the debts you're considering taking on could create long-term financial hardship with no available relief.
Attorney Insight
The mistake I see most often is someone signing a separation agreement and agreeing to pay a joint mortgage or credit card — thinking, "worst case, I'll just file bankruptcy" — without realizing that option is off the table the moment a court order assigns that debt to them. They come in months later underwater on a house their ex-spouse is living in, and I have to explain that § 523(a)(15) means we can't touch it. Read every line of your separation agreement as if bankruptcy doesn't exist, because for those debts, it effectively doesn't.
