U.S. Attorney General Eric Holder has announced that the federal government will expand recognition of same-sex marriages in all federal legal matters, including bankruptcies. Bankruptcy is a legal process in federal courts and governed by laws written by Congress.
This change in policy allows same sex couples to file a joint bankruptcy in any federal jurisdiction, so long as the couple was lawfully married. For instance, a same-sex couple legally married in Massachusetts can now file jointly in an Alabama bankruptcy court, even though the State of Alabama does not allow same-sex marriages. Previously, a same sex joint filing could be challenged if the state in which the bankruptcy was filed did not recognize same-sex marriage.
Holder said, “This means that, in every courthouse, in every proceeding, and in every place where a member of the Department of Justice stands on behalf of the United States — they will strive to ensure that same-sex marriages receive the same privileges, protections and rights as opposite-sex marriages under federal law.” The Department of Justice oversees the U.S. Trustee program in bankruptcy.
The Washington Post is reporting that “Domestic support obligations will include debts, such as alimony, owed to a former same-sex spouse. Certain debts to same-sex spouses or former spouses should be excepted from discharge.” While Justice Department guidelines do not have the force of law, bankruptcy judges will be reluctant to dismiss same-sex cases.
The Justice Department’s new policy comes three years after it said it would not defend cases in court involving the Defense of Marriage Act anymore. In 2013, the U.S. Supreme Court ruled that a key part of DOMA was unconstitutional in U.S. v. Windsor.