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Can Debtors Deduct College Expenses of their Children on the Means Test?

student-loans-hat-andy-giarnellaWritten by Craig D. Robins, Esq.

Several times in the past month this issue has arisen with my Long Island bankruptcy clients:  Can they deduct their children’s college tuition expenses on the means test?  The means test does not provide any specific category for doing so. 

I previously addressed this issue a few months ago:  Can You File For Bankruptcy and Still Pay Your Child’s College Tuition?  [1]   I will now expand upon that prior post.

Unfortunately, those bankruptcy courts which have addressed this issue have found no statutory support for such deductions.

Certain educational expenses can be deducted on the means test.  These include deductions for elementary and secondary education expenses, although the amount is limited.

The means test also permits debtors to deduct expenses for contributions to family members, but this category is also limited to elderly, chronically ill or disabled family members.

Accordingly, at this time, there does not appear to be any way to include a debtor’s contributions to their children’s college expenses on the means test.

The following are some recent cases involving college expense deductions.

In re Baker, No. 08-13987, 2009 Bankr. LEXIS 193 (Bankr. N.D. Ohio Jan. 30, 2009): Recognized that special circumstances might justify allowance of college expenses for adult children, but found that this case does not rise to that level because it is not apparent that the debtor has made a reasonable effort to mitigate her expenses as her adult child could live with the debtor rather than on her own.

In re Saffrin, 380 B.R. 191 (Bankr. N.D. Ill 2007): Held that a debtor may not deduct his daughter’s college expenses because the Code only allows education expenses related to elementary or secondary education.

In re Boyd, 378 B.R. 81 (Bankr. M.D. Pa. 2007): Found that a debtor may not expense her adult daughter’s college education because the Code does not expressly provide such deduction and it does not qualify as another necessary expense.

In re Hess, No. 07-31689, 2007 Bankr. LEXIS 3553 (Bankr. N.D. Ohio Oct. 15, 2007): Found that “[w]hile a parent’s desire to assist a child…pursuing a college degree is laudable, a debtor is not free to do so at the expense of her unsecured creditors.”

In re Featherston, No. 07-60296, 2007 Bankr. LEXIS 4578 (Bankr. D. Mont. Sept. 28, 2007): Held that a debtor may not deduct college expenses for adult children because children are not elderly, chronically ill or disabled as required by the Code to qualify as an acceptable contribution to family members.

In re Goins, 372 B.R. 824 (Bankr. D. S.C. 2007): Held that the Code limits education expenses to those related to elementary and secondary school.

In re Hicks, 370 B.R. 919 (Bankr. E.D. Mo. 2007): Found that a debtor paying college expenses of an adult child is a luxury, not a necessity, and that the Code does not provide any support for allowance of such deduction.

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