Mediation Blog » Child Support

Where Child Support is Spent

admin — Wed, 22 Sep 2010 12:00:41 +0000

If you pay child support, you don’t have any say in how it is spent by the recipient. That sounds harsh, but it’s true. If you are legitimately concerned that you’re paying support and that the recipient is buying drugs, taking expensive vacations leaving your child at home, or making other inappropriate expenditures, you look at changing residential custody arrangements, not controlling the child support. Each state’s guideline calculations take into account the fact that the person with whom the child lives will have to have a larger home or apartment because of the child; perhaps a newer, larger car; and any number of “hidden” expenses (insurance, fenced in yard) over and above the obvious expenses like school lunch and diapers.

If you are concerned that the support you pay will not be used for the children’s benefit, you may wish to negotiate specific payments that you can make directly on behalf of your children in exchange for a reduction in the amount of support you are required to pay to the other parent. For example, you could put the money into a trust fund for the child’s college education. Or, you can pay the daycare provider or school tuition directly, and receive a dollar-for-dollar reduction in your support amounts. You can work to fashion an agreement which assures that the basic needs of the children are met no matter how financially irresponsible the other parent. Use an attorney or mediator to assist you in creating a plan. Click here for good article on the mis-spending of child support.

At all costs, however, keep the interests of your children in mind. You want them to have the best that you and your spouse can afford, and all of the opportunities that they would have had if you had remained married. Don’t let resentment about your loss of control of money interfere with what your children need, and what they deserve. Click here for an article on reducing conflict over child support.

Excerpted from Your Divorce Advisor: A Lawyer and a Psychologist Guide You Through the Legal and Emotional Landscape of Divorce (Simon & Schuster/Fireside 2001). For more information: http://www.yourdivorceadvisor.com/.

For more information contact Peace Talks www.peace-talks.com

More on Child Support vs. Custody

admin — Tue, 21 Sep 2010 12:00:18 +0000

In either case, using time with your children as a substitute for child support doesn’t pay off, in money or metaphoric terms! The money you hoped to save by having the children with you winds up being paid because the children actually have more needs than provided for by Child Support Guidelines. So you spend the money anyhow–you’re just writing the check to the grocery store rather than to your ex-spouse.

That may feel better, but it doesn’t change the amount of money spent. Some parents refuse to buy their children something they request, or spend any money on them, because “it costs too much” after they have won an exchange of more time with the children for paying less child support. In many of those families, the children were raised in middle class neighborhoods, where the now-divorced parents then refused to treat them like other local children were typically treated. This indirectly punishes your child for the divorce, and unfortunately, the message is not missed by most children. For a wealth of terrific information, click here.

Perhaps you really don’t have the money. But if you deny money that you do have to your children, and then spend it on yourself or a new family, the children’s resentment . You will pay child support for up to 21 years. Your children are your children for the rest of your life. Many parents wonder why their children are so angry at them, after he or she used money as a bargaining chip with the other parent. So now that parent has some extra money each month, but a lousy relationship with the children that is far more painful than budget cuts. The other irony is that in some of these situations the children tune into the issues, and redefine their relationship with that parent to be all about money. Like some bad fairy tale, the parent must now live in a self-created situation in which every day is a constant reminder about money, the subject he or she wanted to avoid in the first place. The moral of the story: check your motivations and do not count your pennies at the expense of the big picture over time. For an article on cost effective parenting after divorce, click here.

For more information contact Peace Talks www.peace-talks.com

Child Support vs. Custody

admin — Thu, 16 Sep 2010 12:00:02 +0000

For the parent paying child support, the amount may seem astronomical. “Given the dollars involved, the children should be living like kings.” For the recipient, the money is never enough. The recipient is “shopping with coupons, wearing hand-me-downs, and eating leftovers – and still the ends never meet.” Click here for child support information.

Most people drastically underestimate what children cost. They also underestimate what maintaining two households costs. While you’re living together as a family, you’re paying for one family home, one set of toys, and one set of clothes. When you separate, you’re suddenly paying for two homes, two sets of toys, and almost two sets of clothes. Not all of the additional expenses have to do with the children directly: there are two mortgages or rents, two sets of home insurance, and two sets of household items. And your children’s needs are increasing with age: dancing lessons, soccer dues, hockey equipment, and field trip entrance fees.

Statistically, men who pay child support fare better economically than women who receive child support just years after the divorce is finalized. The Child Support Guidelines adopted by each state were designed to even out the economics of the custodial vs. non-custodial parent. For those who pay support as ordered, and those who receive it, the finances are evening out somewhat. However, other societal factors work against equality, such as the differences in wages between men and women doing the same jobs. Also, parents who see children only on weekends and days off are free to work overtime during the week, and to pursue career-enhancing activities when the children are not with them.

When spouses become embittered about their side of the “lopsided” financial picture, both spouses blame the other, and grouch about their side of the financial picture. If you are feeling angry about how little you get, or how much you pay, try to sit down together and assess where the money is going. Use general categories rather than details about you each spend your money; the divorce obviates that obligation to each other. But look at broad categories and ascertain whether in fact someone is “getting screwed,” or whether there is just less money to spread around. Becoming more realistic about your finances may improve relations with your spouse enormously.

Although the advent of child support guidelines have decreased the tendency to use child support as a bargaining chip in custody negotiations, it still happens. Many parents ask about reductions in child support for shared custody situations. Other parents ask for reductions in support based on split custodial arrangements. The laws of most states recognize that these situations are special, and may warrant an adjustment to the amount of money that one parent pays to the other. Exactly how much the support amounts vary depends on the laws of each state. Some have complicated calculations based on the percentage of time spent with each parent, and other states treat each case separately, based on the facts. Click here for another interesting article.

For more information contact Peace Talks www.peace-talks.com

Voluntary Reduction of Wages

admin — Wed, 08 Sep 2010 12:00:28 +0000

If you have had a stable salary history, child support will most likely be based on that history unless you can prove that the past is not applicable to the future, as in Henry’s situation, above. When confronted with the Child Support Guidelines and divorce, many people react by reducing overtime hours, delaying commissions or bonuses, or otherwise attempting to minimize their incomes, at least until child support is calculated and determined by the court.

This tactic is risky business. Typically, courts award child support (and alimony) based on earning capacity as opposed to actual earnings, and will not hesitate to do so when it appears that people have voluntarily reduced their earnings. Click here for a story about someone’s personal experience with this.

If your income is decreased, you will need to prove that your claimed income reduction is legitimate. For example, if your industry as a whole is shrinking (e.g., “defense contractors”), be prepared to offer industry information and statistics concerning this problem. If your work is seasonal, be prepared to offer evidence of the past 3-5 years of these cycles. If competition has been stepped up with the addition of additional workers, thereby reducing available overtime, be prepared to offer a statement from your employer outlining the changes which have been made in the workforce. If your commission structure has changed, and despite your best efforts you cannot earn what you used to earn, be prepared to explain that as well.

Most important, be prepared to prove that whatever reduction you’ve suffered in earnings is not your fault, and was not voluntary. If the court thinks that you’ve voluntarily reduced your income in an effort to minimize support payments, you risk being ordered to pay support based on previous available earnings, as opposed to your current actual earnings. Click here for another terrific article.

Many people find that their working capacity is lower during the divorce process, because they are stressed, spending so much time on their case, or in court. This constitutes a temporary situation, and will not alter your child support obligations. However, if depression or other psychological factors inhibit you from producing your normal amount of work, or maintaining your usual standard of living, explain this to the court and/or your attorney. You may be offered a temporary reprieve, with a fixed time period after which you’ll be expected to resume your normal daily operations.

The most popular phrase divorce lawyers hear is “Well if I have to pay that much, I’ll quit my job!” That’s no solution to the child support problem, however, because the court can consider your earning capacity, not just your actual earnings. So, if you reduce your overtime, quit your job, take a voluntary demotion, or do anything that voluntarily reduces your income, you take the chance that the court will base your child support on your prior earnings, not on your current earnings.

For more information contact Peace Talks www.peace-talks.com

Special Issues Associated with Earning Capacity

admin — Mon, 06 Sep 2010 12:00:03 +0000

There are special issues associated with earning capacity. One such issue is salary history. Most states include overtime, predictable bonuses and commissions as income for purposes of calculating child support. If you have historically worked a certain amount of overtime, received a bonus each year, or earned a commission on sales, the court will most likely consider these “extras” as a part of your regular income for purposes of calculating the amount of child support due.

In order to be fair, and to protect yourself in the event of a dispute, be inclusive in your calculations. Review your overtime, bonuses and commissions over the past five years. Have they been stable? Or were they linked to unusual circumstances which no longer exist? Are they regular, seasonal, or cyclical with the economy? Have market forces made bonuses erratic both in terms of amount and regularity? Has competition or new additions to the sales force eroded your commissions over time?

For instance, if you are a postal worker, and every Christmas you are required to work an enormous amount of overtime, average your income over the entire year. If your child support is based solely on your Christmas earnings, it will be much higher than is appropriate during the other eleven months of the year. If you work in construction, the summer months may be very busy, but you may be unemployed during the winter time. If you are a daycare provider, your summers are probably busier than the rest of the year. If you are a commissioned salesperson, make sure that your income history–and future– is presented realistically. Click here for more information.

A striking example of this situation was Henry, a commissioned salesperson for an office supply company which had been owned by his father. When his father retired, he passed his accounts on to Henry, who continued to work in the small, family owned business. He earned a very comfortable living….until the office supply superstores invaded his territory. Suddenly, his little Mom-and-Pop enterprise was turned upside down as competition entered the marketplace, eventually forcing him to sell the business to a mega-store. He was offered a job with the store, but had to start from scratch with no accounts to his name. His $350,000 per year income plummeted to less than $50,000. It was important that the judge take into account the new climate in which he was forced to work, and his new compensation structure. A salary history alone would have had devastating results on the Child Support Guidelines. The future became much more pertinent than the past. Click here for another terrific article.

For more information contact Peace Talks www.peace-talks.com

What are Child Support Guidelines?

admin — Thu, 02 Sep 2010 12:00:02 +0000

Each state has Child Support Guidelines which mandate how much support each spouse must contribute toward supporting the children, based on factors which each state determines. The “guidelines” are actually very specific laws with specific calculations. Pick up a copy of your state’s guidelines at your local courthouse, library, or a lawyer’s office. Many are even posted on the internet. You can use the Guidelines to estimate expected child support payments. Each state’s calculations are different, but each takes into account what both parents earn and some of the children’s basic expenses. Child support is also based on how much time the children spend with each of you. Click here to visit a website devoted to child support guidelines.

Child Support and Income

In every state, both parents’ incomes are the key pieces of information used to calculate child support. In addition to mandatory deductions for taxes, many states take into account the children’s health insurance premiums and daycare costs, but other permitted deductions from income influencing child support vary from state to state. If there are factors that allow deviations from the guidelines, they will be listed in the guidelines. Typical deviations may include: a child’s extraordinary medical or educational expenses, extraordinary access expenses (like plane tickets to visit an out-of-state parent), and a child’s own income or assets which may be used for his or her support. Deviations are not permitted because of a parent’s extraordinary “credit card payments” or a “car loan payment”, or other expenses incurred by the parents. The law recognizes that your first responsibility is to your child, not to MasterCard or your landlord.

Most states consider any money which comes to you on a periodic basis to be income. This means that wages, commissions, bonuses, interest, dividends, worker’s compensation, unemployment compensation, and even social security are considered “income” in most states. Income is income, even if you haven’t received it yet. For example, suppose you typically receive a bonus each year based on your sales performance. The cutoff date for your performance record is June 30 of each year. You receive your bonus in December of that same year. If it’s September, your bonus will be considered part of your income even though it hasn’t been received by you yet.

Another example is stock dividends. The dividends are often automatically reinvested, so you don’t actually have the cash to spend. Because stock dividends are earned, and you could choose to liquidate rather than reinvest them, they are deemed to be income.

Social security comes with some complications, since it has special benefits for recipients with minor children. In most cases, the benefits that children receive directly from social security will be considered when child support is calculated. Typically, however, the government-provided benefit is only part of what the parent will be required to pay on the child’s behalf. How social security is treated varies across states, and will be clarified in your state’s child support guidelines. Click here for more information.

For more information contact Peace Talks www.peace-talks.com