‘Debt first, then tithe’ if bankrupt, judge orders

ALBANY, N.Y. — When the collection plate goes around at weekly services, America’s charitable but bankrupt worshipers must now abstain. A federal judge has reluctantly ordered debtors to repay their credit-card bills first. Judge Robert E. Littlefield Jr. of the U.S. Bankruptcy Court for the Northern District of New York has ruled that charitable or religious contributions are no longer considered a necessary living expense for those filing Chapter 13 bankruptcy.

“This change effectively closes the door for debtors who are above the median income from deducting charitable contributions as an expense,” Littlefield wrote in his Aug. 28 opinion. The judge was interpreting a law that went into effect last October which, in effect, deems “tithing” acceptable only in very limited circumstances, such as for ministers who must donate as part of their contract. He said the 2005 law trumps the Religious Liberty and Charitable Donation Protection Act, signed in 1998 by President Bill Clinton, which allowed tithing under the bankruptcy code. More than 2 million Americans filed for bankruptcy protection in 2005 and hundreds of thousands are expected to do the same by the end of 2006, according to the National Association of Consumer Bankruptcy Attorneys.