When a couple is considering bankruptcy, it's likely that they just want to find relief. For many couples, however, it wasn't possible to make a joint bankruptcy filing -- that is, until recently. U.S. Attorney General Eric Holder recently announced that the federal government will provide same-sex couples will additional legal recognition, including the ability to file personal bankruptcy together.
Massachusetts led the nation as the first state to legalize same-sex unions, but couples married in the state were previously unable to declare bankruptcy together because it is a federal legal procedure. Thankfully, many couples will no longer feel restrained from taking the steps to eliminate debt and move forward.
Another thing to note is that this announcement from the Department of Justice doesn't apply only to the states where same-sex couples can legally exchange vows. Instead, because this is a federal matter, any couple with a legally recognized marriage can file in their respective U.S. bankruptcy court. For example, a couple that was married in Massachusetts, but resides in one of 34 states without same-sex marriage, doesn't have to worry about not being able to seek bankruptcy jointly.
A report from CNN notes one particular implication of this legal shift. Alimony and child support debts aren't allowed be discharged in bankruptcy. By recognizing same-sex unions, this will be true for any person who has been legally married and has a divorce settlement calling for support payments.
Marriage unites the personal and financial lives of two people. Just as married same-sex couples are allowed to file income taxes jointly for this reason, permitting bankruptcy is simply another step forward. As such, couples looking to alleviate the pressure of debt may want to consider all of their options, especially since bankruptcy may have become more feasible.
Source: CNN, "Feds to expand legal benefits, services for same-sex marriages," Evan Perez, Feb. 9, 2014
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