- Determining Each Parent’s Gross Income
- Child Support by Court Order vs. by Agreement
- Child Support Enforcement
When a couple with minor children divorces, arrangements for the ongoing support of those children must be made. More than 50 percent of marriages end in divorce, so child support enforcement is a crucial social issue. Child support orders are typically established during the course of divorce proceedings, and state enforcement agencies then take steps to ensure that those orders are followed. If a non-custodial parent won’t pay or falls behind in child support payments, those agencies may seize property, intercept tax refunds or use other means to enforce the child support order.
Like many parents who are going through a divorce, one might be wondering whether they are entitled to receive child support from an ex-spouse. While guidelines can vary from state to state, it is generally fairly simple to figure out which parent will receive support. Although the child support will be paid to a parent, it is technically owed to the child or children.
Who is the Custodial Parent?
During a divorce, the family court makes determinations regarding the custody of minor children. There are two main types of custody: legal and physical. If the child is going to primarily live with one parent, that parent is typically awarded sole physical custody and is therefore considered to be the custodial parent.
Joint Physical Custody
Although it’s less common, the court sometimes awards parents joint physical custody of a minor child. For this to happen, the child must be spending roughly equal amounts of time with both parents. When joint physical custody is awarded, however, it does not mean that neither parent is entitled to support. One is still often ordered to pay, and that’s especially true if one earns significantly more money than the other.
Even if one is the custodial parent, it’s not a foregone conclusion that they will receive child support. Additional considerations include:
- Has a child support order been issued? This normally happens during a divorce. If there’s no order in place, there’s no way to ensure that the non-custodial parent pays support.
- Has paternity been established? If there’s a question about the legal fatherhood, this will need to be done before child support is ordered.
- Is the non-custodial parent’s location known? If not, a state child support services agency may be able to provide free assistance with locating him or her.
Contrary to a fairly common misconception, child support isn’t solely intended to cover a child’s most basic necessities. In other words, it is designed to cover more than food, clothes and shelter. Guidelines regarding the amount of support that must be paid are on the books in all 50 states, and they take into consideration factors like the parents’ incomes, the financial needs of the child and possibly the amount that’s needed to maintain the child’s current standard of living.
The parent who receives child support is not required to prove that the money is used for specific things. It is assumed by the court that the custodial parent is paying for the child’s most basic, necessary expenses, so spending is not monitored.
Although guidelines regarding what child support is supposed to cover vary from state to state, some common examples include:
- Basic Necessities – Child support may be used to cover basic necessities like food, clothes and shelter, so things like groceries, coats and mortgage or rent payments are qualified expenses.
- Educational – Even if a child attends public school, there will be educational expenses for things like lunch, tuition and textbooks.
- Medical – Parents are typically required to carry some type of health insurance for minor children. The parent who has better coverage is usually the one who must provide it.
- Out-of-Pocket Medical Expenses – Child support may be used to cover out-of-pocket medical expenses, including deductibles, copays and the cost of things like glasses and braces.
- Transportation – Transportation costs like car payments, insurance, registration, fuel and public transportation may be paid for with child support money.
- Childcare – Child support may be used to cover the cost of nannies, babysitters and daycare.
- Extracurricular Activities – If a child participates in activities outside of school, including sports, summer camp and after school programs, child support may be used to cover these expenses.
- Entertainment – Age-appropriate forms of entertainment, including Internet, TV and trips to the movies or amusement parks may be paid for with money from child support.
- College – In many states, even after a child has reached the age of majority, both parents may be ordered to contribute to college expenses.
One or both parents in a divorce must submit official income worksheets that supply the figures necessary for calculating child support. Earnings are a primary consideration. Parents must submit proof of income, such as pay stubs or a W-2 form verifying the amount of money they make from work. If self employed, a parent must provide tax returns or other verification of earnings. Additional sources of income relevant to child support orders may include:
- Overtime, bonuses, employment perks or earnings from additional jobs
- Income from pensions, trusts, royalties and estates
- Investment income
- Rental property income
- Social Security or other benefits
- Gifts and winnings
- Unrealized income
For the purposes of child support, overtime pay is a part of a parent’s annual income, even if it varies from year to year. Employee perks, such as a company car, a per diem allotment when on the road for work and company housing also qualify as income if they reduce to a person’s normal living expenses. If a parent takes on a second job, this also counts toward the income calculation.
Even income predating the marriage, such as interest on a trust fund, an inheritance or pension payments, is typically part of the income calculation. This is because child support is not a matter of community property but rather a parental responsibility. A parent must report any royalties he or she receives. Similarly, dividends from investments, whether individual or jointly held, are part of the calculation.
If the couple owned rental property that reverted to just one party in the divorce, the individual now receiving the rental income must include that amount on the work sheet. A parent collecting Social Security benefits or state compensation for an on-the-job injury must declare those amounts as income too.
Prize money and gambling payoffs typically qualify as earnings, and the parent receiving them must declare them on the income work sheet. Gifts of cash qualify too.
Just about any money either parent earns, collects or receives is relevant in calculating income. States strive to collect as much as possible for supporting children of divorce.
Unrealized income is a profitable position someone holds but has not yet cashed in. Some states consider unrealized income sources relevant in their support calculations.
Different jurisdictions disagree on whether IRA interest income qualifies for inclusion. The argument against it holds that this income remains invested in the IRA as long as the account remains active. In states such as Alaska and Montana, courts have ruled to include IRA interest in the support calculation while adjudicators in states such as Tennessee and Virginia have decided to the contrary. A similar issue is whether income from a trust in which the trustee reinvests all interest earnings should count.
Unexercised stock options are another gray area in the income debate. Some state courts have ruled in favor of viewing these options as money in the bank for child support calculation purposes while others do not consider them relevant.
Actual Earnings and Potential Earnings
Actual earnings are the sum of all allowable income sources. Potential earnings are what a person could earn given his or her education, profession and experience. For example, if a non-custodial parent with a medical degree is working as a bagger at the grocery store, a judge is likely to base the child support calculation on a physician’s salary rather than a grocery clerk’s. This reflects the belief that parents should realize their earning potential for their children’s sake.
Expenses in the Child Support Calculation
Similar to calculating income taxes, child support authorities allow deductions from total income before figuring a final child support amount. Social Security and income tax deductions are mandatory. Most states also allow a parent to deduct support obligations for children from a previous union. Parents are allowed deductions for necessities like food, shelter and clothes.
Most states allow the parent paying for the children’s health insurance to deduct that expense as well. The parent paying for child care or other child-related expenses that qualify as mandatory can deduct them. After taking all allowable deductions, the total reflects the parent’s adjusted gross income for the purposes of child support obligations.
Expenses that are not likely to qualify as income deductions include loan payments and entertainment costs. The rationale is that a parent must prioritize children over property and non-mandatory expenditures.
How Custody Affects Child Support
Custody has a bearing on how much child support each parent must pay. Because a parent with sole custody provides housing, food, clothing, schooling and transportation, he or she typically does not have to make child support payments. The non-custodial parent would pay the total amount of the order. However, if parents share custody, most states divide child support obligations according to the earnings ratio between parents and the percentage of time the children spend with each parent.
Basis for the Final Calculation
The courts calculate the amount of monthly child support payments based on one of two methods, depending on state law: income sharing or income percentage. Income sharing is the method of choice in 38 states. It relies on the idea that children are entitled to a portion of parental income just as they would be if the marriage had survived. This allows children to share in their parents’ increases or decreases in income. As an example, a single child would be entitled to 18 to 24 percent of the parents’ net income, two children would receive 28 to 37 percent while three would receive 35 to 46 percent and so on. These percentages lessen as the parents’ income rises.
Advocates believe income sharing to be the fairest way to calculate support for both parents and their children. Both parties contribute according to their abilities and changes in fortune.
The second calculation method, income percentage, is based upon the non-custodial parent’s income only. The ratio of support to income remains the same no matter the parents’ earnings. For example, the non-custodial parent would pay 18 percent of his or her adjusted gross income for supporting one child, 25 percent for two children, 29 percent for three and so on. Unlike with the income shares method, the percentage the non-custodial parent pays remains static even if the custodial parent’s income rises.
Court Discretion in Determining Child Support
In some circumstances and jurisdictions, the judge deciding a divorce can adjust a child support order. If the parent required to pay support earns a large income or owns significant property, a judge might raise the standard payment amount accordingly. If the child or children receiving support have exceptional medical or educational expenses, more support may be called for. On the flip side, a judge could decide that the standard support amount is excessive for a paying parent who is unemployed. In this case, the judge may order a reduction in support on a temporary basis.
Extraordinary Out of Pocket Expenses
Children’s non-insured medical and dental bills are likely to add up. However, most states have specific provisions governing payment of non-covered expenses, and these become part of the child support order. Some states require the non-custodial parent to share such out-of-pocket expenses when they exceed a specific dollar amount. Other states require the non-custodial parent to pay a share of all unexpected medical bills on an income percentage basis.
Child Support by Agreement
If a divorcing couple agrees on the basics of child support and are willing to work together, they may be able to come to an agreement that is then included in the terms of their divorce decree. Although it varies from state to state, child support by agreement usually occurs in one of two ways:
- Informal Negotiations – In this case, the parents negotiate the child support terms themselves. Their attorneys may or may not be present. If attorneys are involved, they may handle the negotiations on behalf of their clients.
- Alternative Dispute Resolution Proceedings – An alternative dispute resolution proceeding, or ADR proceeding, is most commonly handled between the parents and their attorneys. In rare instances, however, arbitration is used, and an impartial third party hears both sides and renders a decision.
Child Support by Court Order
In most states, children under the age of 18 are entitled by law to financial support from both parents. Even if the parents can’t come to an agreement on their own, the court will use various procedures and guidelines to make a determination regarding how support will be handled, and the resulting court order becomes a part of the divorce judgment.
Child Support Orders
When child support is determined by the court during a divorce, the resulting legally enforceable order typically orders the non-custodial parent to pay a certain amount per month, which is calculated according to state guidelines. It also dictates the frequency at which child support payments will be made, the method of payment that will be used and the penalties that will used to enforce the order.
If child support is determined by agreement, the agreement must adhere to state guidelines and be approved by the family court judge who is handling the divorce. If it is determined by the court, it is already approved by the judge and becomes a binding part of the divorce decree.
The Child Support Enforcement Act of 1984 requires state district attorneys to help custodial parents collect child support. Federal law permits a variety of enforcement methods, including income tax refund interception, property seizure and driver’s license revocation.
The Enforcement Process
After the terms of a child support order are determined during a divorce, the state district attorney serves papers on the non-custodial parent requesting a meeting to establish payment arrangements. Failure to respond to this request can result in a variety of penalties, including jail time.
Child Support Enforcement Options
As long as the non-custodial parent adheres to the terms of the child support order, he or she won’t be the subject of enforcement efforts. If the terms of the order are broken, however, a variety of enforcement methods may be used. They vary from state to state but typically include:
- Wage garnishment
- Property seizure
- Withholding of income tax refund
- Suspension of occupational and business licenses
- Revocation of driver’s license
- Passport application denial
- Contempt of court charges and jail time
Out-of-State Non-Custodial Parents
Enforcement of a child support order does not cease when a non-custodial parent moves to a different state. The Uniform Interstate Family Support Act outlines procedures for enforcing orders across state lines. If the state still has jurisdiction over the non-custodial parent, it can continue to enforce the order. If not, the order can be forwarded to the relevant state. The custodial parent can also file an enforcement request in the other parent’s state or have the order sent to the other parent’s employer.
A past-due child support balance is known as an arrearage. Non-custodial parents sometimes go into arrears by simply not paying. Child support is only collected starting at the date of the initial request, so arrearages cannot accrue prior to that point. Child support must be paid according to the terms of the order. If payment is made in person and with cash, for instance, instead of as mandated by the order, arrearages will still accrue. Child support arrearages are not dischargeable by bankruptcy. If the non-custodial parent loses his or her job, the burden is on them to petition the court for a reduction. Until then, arrearages will continue to accrue at the prevailing amount.
Custody, Visitation and Child Support Enforcement
Keep in mind that custody and visitation matters are entirely separate from child support. Withholding child support because the custodial parent isn’t obeying the terms of the custody or visitation agreement is not permitted and will result in various enforcement actions and penalties. The correct course of action is to petition the court to enforce the custody and visitation terms instead.
Once a divorce decree has been handed down by the court, it may be possible for one or both spouses to appeal for a modification to certain elements of it, such as alimony or child support payment amounts. Extenuating circumstances tend to motivate such appeals, and since a child support order that no longer accurately reflects the circumstances of one or both parents affects not only those making and receiving the payments but also the welfare of the children it is intended to benefit, it is particularly crucial that the modification be sought and finalized efficiently and expeditiously. Two types of modification could be sought, typically by the parent who is making the payments:
- Permanent modification: This type of modification reflects a permanent change in circumstances on the part of the parent making the payments, such as job loss or permanent disability. If either parent remarries, this can entail a change in one parent’s household income, which may also call for a change in the child support payment amount. Other permanent changes that could necessitate a modification include legislative changes to child support laws in the jurisdiction in which the divorce decree was finalized and a permanent change in the needs of the child due to chronic illness or disability.
- Temporary modification: A temporary and often sudden change in circumstances can call for a temporary modification to the payment amounts. This could include a medical emergency involving the child or one of the parents, with or without a change in custody accompanying the hospitalization of the custodial parent, or the temporary loss of employment by one parent.
Acting quickly to get a modification put in place is crucial. Appealing for a modification does not put payments under the current order on hold, so it’s important for the noncustodial parent requesting the order to try to keep current on payments. Otherwise, an unpaid overdue balance can accrue. If possible, payments should continue to be paid even while the modification is being sought until it is finalized. If the circumstances warranting the modification request preclude making timely and full payments, the individual seeking the modification should document these circumstances and attempts to improve the circumstances if possible. Keeping a detailed record of household income and expenses is the foundation of this documentation. If job loss prompted the modification request, copies of job applications sent to prospective employers could help prove that the person is actively seeking to improve his or her circumstances.
How To Obtain A Child Support Modification
After thoroughly documenting the change in circumstances warranting the modification – including a statement from former employer following a job loss or medical bills showing the financial impact of a medical emergency, for instance – the parent seeking the modification would do well to try to arrive at an agreement with other parent. Mediation may be productive toward this end to potentially avoid drawn-out litigation and high court costs.
Next, the parent seeking the modification will most likely have to file a formal request with court that issued the original child support order. A new order will have to be issued by court, and papers will have to be served on the other parent. A copy must be provided to the court clerk as well as a proof of service, which certifies that the other papers were indeed served on the other party. Some jurisdictions require specific forms, often called a “motion” or ”petition” for modification along with supplementary forms, several copies of forms or even worksheets. One should be sure to file with the correct court as some jurisdictions may have a court specifically for family law matters. If the other party contests the modification, securing strong legal counsel will be paramount in ensuring the appeal has the best chance of going forward.
Divorce decrees in some jurisdictions contain a cost of living adjustment clause inserted by the judge to circumvent the paperwork-heavy court procedure described above by changes in the cost of living to be reported annually. The child support payments will be automatically adjusted to reflect these changes. Other changes in circumstances will still require a formal appeal for modification, however.
The rules governing when child support payments end vary by jurisdiction when it comes to the finer points. In general, however, most jurisdictions agree that child support payment are terminated when:
- The child reaches the age of majority – that is, the age at which he or she is deemed capable of making legal decisions on his or her own behalf. In most states, child support will be terminated when a child reaches the age of 18 or when he or she graduates from high school. However, some states make special allowances for child support to be applied to a child’s college education while others strictly forbid compelling a parent to pay for a child’s college tuition. In a few jurisdictions, the age of majority is 21.
- The child becomes emancipated. If a minor undergoes a special court process called emancipation in order to become financially independent, he or she is no longer legally entitled to support. Getting married, enlisting in the armed forces and living independently all indicate financial independence and free the parent making payments from having to provide further support under the law. However, a cessation of child support can be temporary when emancipation occurs if the minor moves back in with the custodial parent and is no longer self-supporting.
Some special circumstances may extend child support payments beyond the age of majority. Even in states that do not allow child support to continue beyond the age of majority for the sake of the child’s college education, one or both parents can plan for that contingency by including a special provision in the divorce decree.
Special needs children may also require extensive care that extends well beyond the age of majority. Courts often perceive disability as an economic hardship warranting financial support and will thus award long-term support for the parent taking care of such a child.
Regardless of the finer points of a state’s statutes governing child support, child support will not end on its own in any jurisdiction. It is the responsibility of the parent making the payments to request the termination of his or her child support obligation.
Unmarried Parents and Child Support
Parental responsibility for the financial support of children is an established fact of American jurisprudence, whether or not the couple is married. If the mother is the custodial parent and the father will not admit to paternity, the mother may be required to petition the court to order the absent father to submit to paternity testing before she can sue for child support.
Once DNA testing has legally established the father’s paternity, the court will determine the amount of child support it deems appropriate and order the father to pay. If the father refuses to comply with the child support order without sufficient reason, he may be held in contempt of court, arrested and criminally prosecuted for nonpayment. Penalties may include fines and/or jail time.
Other methods of enforcement include wage garnishment, federal tax refund attachment, blocked passport renewal and driver’s or professional license suspension or revocation. In other words, the unmarried father who does not fulfill his court-ordered child support obligation is subject to the same penalties as his married counterpart.
Interstate Moves and Child Support
When the non-custodial parent moves out of state, collecting child support can become more difficult. In fact, this is the precise reason why some non-custodial parents move across state lines: to escape their legal responsibility for supporting their children. However, there is help for the beleaguered custodial parent in the form of the Revised Uniform Reciprocal Enforcement of Support Act (RURESA). This act helps facilitate cooperation between the courts in both states, making it easier for custodial parents to request and receive the child support payments the law demands.
Child support is a complex topic that both custodial and non-custodial parents need to understand. The topic is made even more complex by the fact that child custody laws vary from state to state. For this reason, it’s always wise to solicit the advice of an experienced family law attorney — particularly when the other parent is not complying with the law.