From the Editor – Best Interests of Creditors Test • NACTT Academy

From the Editor – Best Interests of Creditors Test

By The Honorable William Houston Brown (Retired)

Postpetition domestic support obligation was not allowed claim and best interests test failed. Although the Code defines domestic support obligation to include pre- and postpetition obligations, and the debtor may deduct postpetition domestic support obligations in the projected disposable income calculation, § 502(b)(5) disallows a claim to the extent it is for a debt unmatured at petition date, while the debt is excepted from discharge under § 523(a)(5). Only the prepetition DSO claim is an “allowed claim,” notwithstanding other Code requirements that the debtor pay postpetition domestic . . .

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