**BANKRUPTCY ABUSE PREVENTION AND CONSUMER PROTECTION ACT OF 2005**

**House Report 109-031, Part 1,** **Subtitle B. Priority Child Support**

*Sec. 211. Definition of Domestic Support Obligation.* Section 211 of
the Act amends section 101 of the Bankruptcy Code to define a domestic
support obligation as a debt that accrues before, on, or after the date
of the order for relief and that it includes interest that accrues
pursuant to applicable nonbankruptcy law. As defined in the Act, the
term includes a debt owed to or recoverable by: (1) a spouse, former
spouse, or child of the debtor, or such child\'s parent, legal guardian,
or responsible relative; or (2) a governmental unit. To qualify as a
domestic support obligation, the debt must be in the nature of alimony,
maintenance, or support (including assistance provided by a governmental
unit), without regard to whether such debt is expressly so designated.
It must be established or subject to establishment before, on, or after
the date of the order of relief pursuant to: (1) a separation agreement,
divorce decree, or property settlement agreement; (2) an order of a
court of record; or (3) a determination made in accordance with
applicable nonbankruptcy law by a governmental unit. It does not apply
to a debt assigned to a nongovernmental entity, unless it was assigned
voluntarily by the spouse, former spouse, child, or parent solely for
the purpose of collecting the debt.

*Sec. 212. Priorities for Claims for Domestic Support Obligations.*
Section 212 of the Act amends section 507(a) of the Bankruptcy Code to
accord first priority in payment to allowed unsecured claims for
domestic support obligations that, as of the petition date, are owed to
or recoverable by a spouse, former spouse, or child of the debtor, or
the parent, legal guardian, or responsible relative of such child,
without regard to whether such claim is filed by the claimant or by a
governmental unit on behalf of such claimant, on the condition that
funds received by such unit under this provision be applied and
distributed in accordance with nonbankruptcy law. Subject to these
claims, section 212 accords the same payment priority to allowed
unsecured claims for domestic support obligations that, as of the
petition date, were assigned by a spouse, former spouse, child of the
debtor, or such child\'s parent, legal guardian, or responsible relative
to a governmental unit (unless the claimant assigned the claim
voluntarily for the purpose of collecting the debt), or are owed
directly to or recoverable by a governmental unit under applicable
nonbankruptcy law, on the condition that funds received by such unit
under this provision be applied and distributed in accordance with
nonbankruptcy law. Where a trustee administers assets that may be
available for payment of domestic support obligations under section
507(a)(1) (as amended), administrative expenses of the trustee allowed
under section 503(b)(1)(A), (2) and (6) of the Bankruptcy Code must be
paid before such claims to the extent the trustee administers assets
that are otherwise available for the payment of these claims.

*Sec. 213. Requirements To Obtain Confirmation and Discharge in Cases
Involving Domestic Support Obligations.* With respect to chapter 11
cases, section 213(1) adds a condition for confirmation of a plan. It
amends section 1129(a) of the Bankruptcy Code to provide that if a
chapter 11 debtor is required by judicial or administrative order or
statute to pay a domestic support obligation, then the debtor must pay
all amounts payable under such order or statute that became payable
postpetition as a prerequisite for confirmation.

With respect to chapter 12 cases, section 213(2) of the Act amends
section 1208(c) of the Bankruptcy Code to provide that the failure of a
debtor to pay any domestic support obligation that first becomes payable
postpetition is cause for conversion or dismissal of the case. Section
213(3) amends Bankruptcy Code section 1222(a) to permit a chapter 12
debtor to propose a plan paying less than full payment of all amounts
owed for a claim entitled to priority under Bankruptcy Code section
507(a)(1)(B) if all of the debtor\'s projected disposable income for a
five-year period is applied to make payments under the plan. Section
213(4) of the Act amends Bankruptcy Code section 1222(b) to permit a
chapter 12 debtor to propose a plan that pays postpetition interest on
claims that are nondischargeable under Section 1228(a), but only to the
extent that the debtor has disposable income available to pay such
interest after payment of all allowed claims in full. Section 213(5)
amends Bankruptcy Code section 1225(a) to provide that if a chapter 12
debtor is required by judicial or administrative order or statute to pay
a domestic support obligation, then the debtor must pay such obligations
pursuant to such order or statute that became payable postpetition as a
condition of confirmation. Section 213(6) amends Bankruptcy Code section
1228(a) to condition the granting of a chapter 12 discharge upon the
debtor\'s payment of certain postpetition domestic support obligations.

With respect to chapter 13 cases, section 213(7) of the Act amends
Bankruptcy Code section 1307(c) to provide that the failure of a debtor
to pay any domestic support obligation that first becomes payable
postpetition is cause for conversion or dismissal of the debtor\'s case.
Section 213(8) amends Bankruptcy Code section 1322(a) to permit a
chapter 13 debtor to propose a plan paying less than the full amount of
a claim entitled to priority under Bankruptcy Code section 507(a)(1)(B)
if the plan provides that all of the debtor\'s projected disposable
income over a five-year period will be applied to make payments under
the plan. Section 213(9) amends Bankruptcy Code section 1322(b) to
permit a chapter 13 debtor to propose a plan that pays postpetition
interest on nondischargeable debts under section 1328(a), but only to
the extent that the debtor has disposable income available to pay such
interest after payment in full of all allowed claims. Section 213(10)
amends Bankruptcy Code section 1325(a) to provide that if a chapter 13
debtor is required by judicial or administrative order or statute to pay
a domestic support obligation, then the debtor must pay all such
obligations pursuant to such order or statute that became payable
postpetition as a condition of confirmation. Section 213(11) amends
Bankruptcy Code section 1328(a) to condition the granting of a chapter
13 discharge on the debtor\'s payment of certain postpetition domestic
support obligations.

*Sec. 214. Exceptions To Automatic Stay in Domestic Support
Proceedings.* Under current law, section 362(b)(2) of the Bankruptcy
Code excepts from the automatic stay the commencement or continuation of
an action or proceeding: (1) for the establishment of paternity; or (2)
the establishment or modification of an order for alimony, maintenance
or support. It also permits the collection of such obligations from
property that is not property of the estate. Section 214 makes several
revisions to Bankruptcy Code section 362(b)(2). First, it replaces the
reference to \`alimony, maintenance or support\' with \`domestic support
obligations.\' Second, it adds to section 362(b)(2) actions or
proceedings concerning: (1) child custody or visitation; (2) the
dissolution of a marriage (except to the extent such proceeding seeks
division of property that is property of the estate); and (3) domestic
violence. Third, it permits the withholding of income that is property
of the estate or property of the debtor for payment of a domestic
support obligation under a judicial or administrative order as well as
the withholding, suspension, or restriction of a driver\'s license, or a
professional, occupational or recreational license under state law,
pursuant to section 466(a)(16) of the Social Security Act. Fourth, it
authorizes the reporting of overdue support owed by a parent to any
consumer reporting agency pursuant to section 466(a)(7) of the Social
Security Act. Fifth, it permits the interception of tax refunds as
authorized by sections 464 and 466(a)(3) of the Social Security Act or
analogous state law. Sixth, it allows medical obligations, as specified
under title IV of the Social Security Act, to be enforced
notwithstanding the automatic stay.

*Sec. 215. Nondischargeability of Certain Debts for Alimony,
Maintenance, and Support.* Section 215 of the Act amends Bankruptcy Code
section 523(a)(5) to provide that a \`domestic support obligation\' (as
defined in section 211 of the Act) is nondischargeable and eliminates
Bankruptcy Code section 523(a)(18). Section 215(2) amends Bankruptcy
Code section 523(c) to delete the reference to section 523(a)(15) in
that provision. Section 215(3) amends section 523(a)(15) to provide that
obligations to a spouse, former spouse, or a child of the debtor (not
otherwise described in section 523(a)(5)) incurred in connection with a
divorce or separation or related action are nondischargeable
irrespective of the debtor\'s inability to pay such debts.

*Sec. 216. Continued Liability of Property.* Section 216(1) of the Act
amends section 522(c) of the Bankruptcy Code to make exempt property
liable for nondischargeable domestic support obligations notwithstanding
any contrary provision of applicable nonbankruptcy law. Section 216(2)
and (3) make conforming amendments to sections 522(f)(1)(A) and
522(g)(2) of the Bankruptcy Code.

*Sec. 217. Protection of Domestic Support Claims Against Preferential
Transfer Motions.* Section 217 of the Act makes a conforming amendment
to Bankruptcy Code section 547(c)(7) to provide that a bona fide payment
of a debt for a domestic support obligation may not be avoided as a
preferential transfer.

*Sec. 218. Disposable Income Defined.* Section 218 of the Act amends
section 1225(b)(2)(A) of the Bankruptcy Code to provide that disposable
income in a chapter 12 case does not include payments for postpetition
domestic support obligations.

*Sec. 219. Collection of Child Support.* Section 219 amends sections
704, 1106, 1202, and 1302 of the Bankruptcy Code to require trustees in
chapter 7, 11, 12, and 13 cases to provide certain notices to child
support claimants and governmental enforcement agencies. In addition,
the Act conforms internal statutory cross references to Bankruptcy Code
section 523(a)(14A) and deletes the reference to Bankruptcy Code section
523(a)(14) with respect to chapter 13, as this provision is inapplicable
to that chapter.

Section 219(a) requires a chapter 7 trustee to provide written notice to
a domestic support claimant of the right to use the services of a state
child support enforcement agency established under sections 464 and 466
of the Social Security Act in the state where the claimant resides for
assistance in collecting child support during and after the bankruptcy
case. The notice must include the agency\'s address and telephone number
as well as explain the claimant\'s right to payment under the applicable
chapter of the Bankruptcy Code. In addition, the trustee must provide
written notice to the claimant and the agency of such claim and include
the name, address, and telephone number of the child support claimant.
At the time the debtor is granted a discharge, the trustee must notify
both the child support claimant and the agency that the debtor was
granted a discharge as well as supply them with the debtor\'s last known
address, the last known name and address of the debtor\'s employer, and
the name of each creditor holding a debt that is not discharged under
section 523(a)(2), (4) or (14A) or holding a debt that was reaffirmed
pursuant to Bankruptcy Code section 524. A claimant or agency may
request the debtor\'s last known address from a creditor holding a debt
that is not discharged under section 523(a)(2), (4) or (14A) or that is
reaffirmed pursuant to section 524 of the Bankruptcy Code. A creditor
who discloses such information, however, is not liable to the debtor or
any other person by reason of such disclosure. Subsections (b), (c), and
(d) of section 219 of the Act impose comparable requirements for chapter
11, 12, and 13 trustees.

*Sec. 220. Nondischargeability of Certain Educational Benefits and
Loans.* Section 220 of the Act amends section 523(a)(8) of the
Bankruptcy Code to provide that a debt for a qualified education loan
(as defined in section 221(e)(1) of the Internal Revenue Code) is
nondischargeable, unless excepting such debt from discharge would impose
an undue hardship on the debtor and the debtor\'s dependents.