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  • Set-off method is unfair to higher earner?

    Hi there. I've been struggling with this concept for some time and would love to hear others' opinions on the matter.

    I currently have an agreement in place with my ex that follows standard Federal Guidelines. We have 2 children and 50/50 shared custody, and I earn quite a bit more than she does: the federal tables suggest my contribution to support is about $1100 and hers is about $400.

    Now, with the standard offset, I'm paying her $700, and that's what I've been doing for years. I've been really struggling with my budget, living paycheque to paycheque, never having enough for unexpected expenses (dental, car repairs etc), no credit, and *never* any hope for any kind of savings.

    It got me looking at the match of the offset method, and it just doesn't makes sense to me!

    The federal tables are supposed to represent how much a person with a certain income *should* spend on child care, regardless of custody arrangements:

    "The child support amounts in the tables reflect what parents living in the same province, with the same incomes and the same number of children would spend on their children." (About Child Support in Canada)

    So of my $1100 that I should have earmarked for my kids, I'm giving $700 to my ex, leaving me with $400 to spend on them when they're with me. On the other hand, my ex has her $400 from her own income, plus my $700, so she gets $1100 to spend on them when they're with her!!

    In other words, we've swapped roles ... she gets my table amount to spend on the kids, and I get her table amount. If I earn more, it does *nothing* to help my budget, as the set-off calculation always gives her whatever the tables say *I* should pay, and I'm stuck with only whatever she earns.

    Whenever trying to talk to lawyers or counsellors all I get back is: "That's what the guidelines say, if you think it's unfair, take it to a judge." And that's what I'll do, I guess, but I'm afraid no-one will look at the actual *logic* of this, and just say: "Everyone uses the set-off method. That's what the guidelines say."

    Please help me understand how the set-off method is fair, and if there's any hope in doing something more reasonable like, say, *splitting* the set-off amount, so we'd both end up with equal amounts to spend on the kids when they're at our homes. (In my case I'm suggesting I pay her $350 instead of $700, so we both end up with $750 to spend on the kids.)

  • #2
    Set-off method is unfair to higher earner?

    I've been struggling with this calculation for some time now and I'm hoping to get some opinions on the fairness of the standard set-off method used when calculating child support.

    I have a 50/50 shared custody agreement for our 2 kids. I make quite a bit more than her, so that the table amounts suggest my contribution to their care is about $1100 and hers is about $400. We do what seems to be the standard thing -- I pay her the difference, $700. I believe this is called the "set-off" method.

    The problem I have is that if you then look at how much we actually get to spend on the kids when they are with each of us, she gets WAY more than me. The federal support table values were created to show the proportion of your income that should go towards child care, regardless of marriage/custody:

    "The child support amounts in the tables reflect what parents living in the same province, with the same incomes and the same number of children would spend on their children." (About Child Support in Canada)

    In other words, an intact family making the same income that I do would typically spend $1100 of their wages towards the care of their children. The courts seem to rely heavily on this figure, and I think that makes sense.

    However, after I pay $700 to my ex, I am left with just $400 (of my table-supported amount $1100) to spend on my kids, while she gets $1100 (her $400 from her salary, plus the $700 I give her). This is totally out of proportion!! We share the kids equally, have similar lifestyles and standards of living, and yet she has nearly 3 times the amount of money to spend on our kids than I do.

    Worse yet, if I go out and bust my hump and make *more* money, I *still* end up with just $400 to spend on the kids, and every extra dollar in the table amounts goes directly to her.

    How is the set-off method justified? It seems more fair to *split* the set-off, so each parent ends up with the same amount of money in the end to care for the kids. In my case, I should give her $350, so that I have $1100-$350=$750, and she has $400+$350=$750.

    I would happily take her to court and make this argument in front of a judge; however, it seems the set-off method is so entrenched in case law that I'm very concerned my arguments won't even be heard!

    Any comments -- on both sides of the fence -- would be greatly appreciated!

    Comment


    • #3
      Your idea that you would happily take her to court and argue this in front of a judge is not a great idea if you are intending to argue the Guidelines are unfair per se. The Child Support Guidelines are part of the Family Law Act, they are legislation. In order to challenge legislation you would have to take the Crown to the Supreme court and argue the constitutionality of the legislation.

      You may argue your own situation in family court, if you can show that your situation is different than most other's. Within the family court system, you may address a relative unfairness in the setoff method according to certain criteria:

      <!-- TRANSIT - HYPERLINK --><!-- .droit de la famille (Loi sur le) - R├Ęgl. de l'Ont. 391/97. -->9. Where a parent or spouse exercises a right of access to, or has physical custody of, a child for not less than 40 per cent of the time over the course of a year, the amount of the order for the support of a child must be determined by taking into account,
      (a) the amounts set out in the applicable tables for each of the parents or spouses;
      (b) the increased costs of shared custody arrangements; and
      (c) the condition, means, needs and other circumstances of each parent or spouse and of any child for whom support is sought. O. Reg. 391/97, s. 9.
      The concept of the setoff comes from point (a). The concept of point (b) is really why it takes more than $1100 to care for the children in your example; it costs more to provide two households than one, so the setoff amount tends to favour the lower earning parent. Yes the Guidelines are purposefully setup that way. Point (c) is your recourse to show that your needs, or the childrens needs, are provided for under the setoff amount.

      In order to make a challenge like that you would need a completely detailed budget supported by receipts and statements to show that you are not able to make ends meet under the current amount.

      Your argument that if you make money it "all" goes into the setoff is factually incorrect. The table amounts will not transfer all additional income to child support, it is a percentage.

      Comment


      • #4
        I disagree on several points. The setoff method is *not* mandated by the Act, with regard to section 9(a) for Shared Custody. It's a fine point, but compare to section 8, with Split Custody -- it says right there that you have to use the setoff. In section 9(a) it merely states that you have to take the table amounts into account; my suggestion to split the setoff amount *does* take it into account.

        I agree, though, that it's a long shot, just because case law shows that judges tend to default 9(a) meaning setoff. I really don't like this, as my argument is simply about FAIRNESS. There is no valid reason why my ex should enjoy $1100 to spend on the kids without having to consider spending a dime more from her own paycheque than what the tables suggest, while *I'm* expected to either scratch along with $400 for the kids, or dive heavily into what little remains of my pay just to get some parity with her.

        It's true that if I make more money, then only a percentage of that goes to her. However, I still end up with just $400 to spend on the kids, unless I dip into my extra pay. I would be able to do that a little -- given my new income -- but could still never come *close* to parity with her.

        What I'm wondering is if anyone can suggest why this situation is considered fair by the courts? Even if we ignore my personal financial hardship, why is the setoff considered the default calculation method, when it leads to such a gross imbalance in funds available to the higher income earner?

        Comment


        • #5
          I should add, that the costs associated with 9(b) could be offset with a multiplier. Canada doesn't tend to do this a ton, I think, but there are examples where it's been done. That way we both take (proportionate) responsibility for those increased costs. But then we still need to split the difference, so we end up with equal amounts to spend on the kids in our homes.

          For example, use a 50% multiplier (standard) to cover 9(b) costs; then the setoff amount is $700 x 1.5 = $1050. Divide that by 2 so that my net support to her is $525. We now both have $1125 to spend on the kids. It would be a major burden to me to spend that extra amount on them, given my current financial hardship; but at least my ex would also be contributing to the 50% increase in costs, and not just me.

          Comment


          • #6
            Originally posted by rthombe View Post
            I currently have an agreement in place with my ex that follows standard Federal Guidelines. We have 2 children and 50/50 shared custody, and I earn quite a bit more than she does: the federal tables suggest my contribution to support is about $1100 and hers is about $400.
            If your full table on the offset calculation is 1,100 you make 75,000 per annum. I know this because mysupportcalculator.ca tells me this:
            Self pays Spouse child support of $1,105 per month , as a starting point subject to further adjustments, according to the Child Support Guidelines ("CSG").

            If the other parent's full table on the offset calculation is 400 then the other parent makes 28,000 per annum. I know this because mysupport calculator.ca tells me this:
            Self pays Spouse child support of $408 per month , as a starting point subject to further adjustments, according to the Child Support Guidelines ("CSG").

            The offset calculation would be:
            Self pays Spouse child support of $697 per month , as a starting point subject to further adjustments, according to the Child Support Guidelines ("CSG").

            Breaking this down further at 700 a month paid to the other parent:

            700*12 (months) = 8400 per year.

            After taxes you take home about 58,000 per year.

            58000 - 8400 = 49,600 (after tax and child support)

            I am sure there are parents on this forum who would not balk at having after tax income of 49,600 per year.

            I don't really see how 8,400 in child support payments per year is sinking your finances. Unless you have significant debt from something else to worry about, have a 2,450 a month rent apartment in Liberty Village and drive a sports car...

            The average Canadian household income is what you make generally AFTER TAX AND PAYING OFFSET CHILD SUPPORT.

            You can live comfortably and well within your means if you plan properly.

            Good Luck!
            Tayken

            Comment


            • #7
              Originally posted by rthombe View Post
              I disagree on several points. The setoff method is *not* mandated by the Act, with regard to section 9(a) for Shared Custody. It's a fine point, but compare to section 8, with Split Custody -- it says right there that you have to use the setoff. In section 9(a) it merely states that you have to take the table amounts into account; my suggestion to split the setoff amount *does* take it into account.

              I agree, though, that it's a long shot, just because case law shows that judges tend to default 9(a) meaning setoff. I really don't like this, as my argument is simply about FAIRNESS. There is no valid reason why my ex should enjoy $1100 to spend on the kids without having to consider spending a dime more from her own paycheque than what the tables suggest, while *I'm* expected to either scratch along with $400 for the kids, or dive heavily into what little remains of my pay just to get some parity with her.

              It's true that if I make more money, then only a percentage of that goes to her. However, I still end up with just $400 to spend on the kids, unless I dip into my extra pay. I would be able to do that a little -- given my new income -- but could still never come *close* to parity with her.

              What I'm wondering is if anyone can suggest why this situation is considered fair by the courts? Even if we ignore my personal financial hardship, why is the setoff considered the default calculation method, when it leads to such a gross imbalance in funds available to the higher income earner?
              My observation... You can go in and argue this but, be sure to in your budget outline that Mess recommends that you include the future costs awards against you for bringing your matter to court.

              My finger in the air estimate to what a costs order against you for your argument, should you (probably will) fail is anywhere between 5,000 to 35,000.

              So, if you pay 8,400 a year in CS... You just wasted 4 years of child support payments trying to lower them and yet, you still will have to probably pay them anyhow.

              "Good money after bad."
              "Penny wise, pound foolish."

              Just saying.

              Good Luck!
              Tayken

              Comment


              • #8
                Originally posted by rthombe View Post
                ...
                What I'm wondering is if anyone can suggest why this situation is considered fair by the courts? Even if we ignore my personal financial hardship, why is the setoff considered the default calculation method, when it leads to such a gross imbalance in funds available to the higher income earner?
                Because the courts and lawyers are bad at math and reasoning, and just like the government and a lot of peoples attitude, who ever has more should pay more.

                I agree that the setoff method is not reasonable.

                The math works out if it costs twice as much to raise the kids in two homes, as compared to one. Which is of course not true.

                Also, even if one would suppose that it could cost twice as much to raise them in two homes, this is also not reasonable because people would not have the ability to spend twice as much and would necessarily cut back on expenses anyway (ie a lower standard of living).

                Of course with the parents making the same amount, the offset method yields $0 so this is not unfair. The larger the difference between the incomes, the greater the injustice.

                I think though that it is reasonable to assume that it does cost more to raise the kids in two homes as compared to one, and that parents do spend more of their income on their kids in this situation. So the amount should be somewhere between half and the full offset.

                Comment


                • #9
                  I love this forum!! This is exactly the kind of discussion I was hoping to get! I could never get lawyers (or my ex) to engage in a constructive back-and-forth like this! This is truly helping me, and I appreciate everyone's input.

                  To respond to Tayken, I think it's missing the point, which is simple fairness. Even if I could live well within these means, I don't think my ex should live *beyond* my means. In isolating the consideration to just how we can spend money on the kids, where is the justification for her living with so much more?

                  However, that said, I can't live within these means. My net monthly pay is $4500. I have a family of 4 living full-time at home, plus the two part-time kids. My rent is $1700, which is an amazing deal for a house that can fit 6 people; previously we lived in a basement suite for $1300 that was really the best we could do for 3 bedrooms, and it was *tiny* and stressful living there. I wish I could spend less on rent, but we tried, and we couldn't pull it off.

                  I have $725/month in mandatory debt payments, the result of a Consumer Proposal that just barely staved off bankruptcy; these debts were incurred during the marriage and after as a result of the divorce, so I believe they are very relevant.

                  We try to get by on $800/month for food, but for all of us, it's never enough and we end up borrowing from friends or family (or Money Mart! Yikes!) just to buy milk and hamburger for dinner in the days before my next pay.

                  We budget $250/month for gas and insurance -- again, not really enough, but it's close.

                  So where does that leave us? $1700 (rent) + $725 (debt) + $800 (food) + $250 (car) + $1100 (support) ... that's all she wrote!! Nothing left for utilities, entertainment, clothing, toiletries, medicine, dental, school supplies, and forget about savings or emergencies like car repairs!! Even if you thought my rent was a little high, or I could shave off $100 from food or something like that, we're under water no matter how you look at it.

                  Comment


                  • #10
                    Teyken -- re: costs incurred in fighting -- Hah! Yeah, no kidding. I talked to a lawyer about this, as my ex only works part-time and I wanted to have her salary imputed to a higher amount. But he pointed out that to have a good argument in court I would have to have an investigator search job postings and attempt to *prove* she ignored opportunities to work for more money, and in the end the difference in support wouldn't come close to paying for the investigator. Sigh.

                    Comment


                    • #11
                      Originally posted by billm View Post
                      Because the courts and lawyers are bad at math and reasoning, and just like the government and a lot of peoples attitude, who ever has more should pay more.

                      I agree that the setoff method is not reasonable.
                      How about we look at it from a totally different angle then? (Just pondering a position that one should consider prior to trying to "fight it out in court" to change the calculations...)

                      Assumption made:

                      The OP has 50-50 access and presumably joint custody in the matter.

                      This parent, is an equal and full joint parent with joint residency. This means that the OP equally does everything the other parent does, cares for, feeds, raises and is equally involved in the children's lives.

                      Yet, no one has identified possibly that not only do they do this they are the higher income earner. I know, the court will not give you a pat on the back for being able to do everything the other parent does but, as a fellow tax payer, I have to say, it is rather impressive that this parent, can do this.

                      So, I congratulate all the offset child support paying parents who not only do equally what the other parent does every day for the children, for which possibly these offset paying parents had to obtain a court order often to do equally and not just prove that they are an equal parent in those aspects of parent but, possibly a really great parent in that they are able to do all of that and have a successful career.

                      To any parent who gets offset support paid to them they shouldn't look at this as something the other parent "has to do" or that "they should have to pay" but, something that they are able to do. Something that they cannot do and they should really question why they are unable to before thinking they "won" anything by getting offset child support.

                      Something that they themselves, even though being "equal" in parenting, are unable to do themselves.

                      If someone wants to argue that they are "equal" parents when getting offset child support they really need to consider if they are truly "equal" in all aspects and not just in the routine care of the children.

                      A high income earning offset paying parent in shared parent is demonstrating to their children that they can be a parent and have a successful career. Something the court won't recognize but, something society does recognize.

                      Not only do you demonstrate to your children that you can do everything the other parent does to care for them but, you can earn a damn good income doing it all at the same time too.

                      One would question why you as an equal parent can do everything the other parent does and earn a higher income. Paying child support on the offset isn't a negative thing but, something that can be positively rewarding if you look at it from the proper perspective. You invested in your career, focused on continually improving your career and to the benefit of your family.

                      Your kids may not appreciate that now OP but, one day they will be adults and really respect this fact you did this for them probably.

                      Good Luck!
                      Tayken

                      Comment


                      • #12
                        Originally posted by rthombe View Post
                        Teyken -- re: costs incurred in fighting -- Hah! Yeah, no kidding. I talked to a lawyer about this, as my ex only works part-time and I wanted to have her salary imputed to a higher amount. But he pointed out that to have a good argument in court I would have to have an investigator search job postings and attempt to *prove* she ignored opportunities to work for more money, and in the end the difference in support wouldn't come close to paying for the investigator. Sigh.
                        Also, even if you win on "principal" I am doubtful that a court would order costs against the other party if you prove that the guidelines are biased, wrong or whatever. So you will probably have to eat your costs for "winning" which would probably amount to more than what you would pay in total for child support for both children are no longer children of the marriage by definition.

                        Long term versus short term objectives. Sounds like you had a very good lawyer involved in your matter.

                        Comment


                        • #13
                          Originally posted by billm View Post
                          Because the courts and lawyers are bad at math and reasoning, and just like the government and a lot of peoples attitude, who ever has more should pay more.
                          This is my fear. I'm worried about walking into court, and after all my careful examples and formulas and arguments, the judge rips into me because I'm trying to be a deadbeat dad, without even answering one of my questions. And then seeing the smug smile on my ex as we exit the building.

                          Well, I will likely go ahead and file the application anyway, just to see if I can bring her to the table to hear me personally. She won't talk to me about it right now -- just ignores my emails and calls. It will be months before an actual court date -- so they tell me -- so maybe once she's served and forced to respond, she'll see I'm really suffering here.

                          Won't hold my breath, though.

                          Comment


                          • #14
                            then move to Quebec (and convince your ex to move to Quebec).

                            based on Quebec guidelines you would pay logical amount of CS and it is adjusted every year when you file your taxes, automatically... No BS... not unnecessary motions. Based on Quebec guidelines the amount of the child support is based on the income of both parents and the amount hey are supposed to contribute is determined in proportion of their income and number of days the child spends with each parent.

                            Every divorcing couple has to go to mediation, first 6 sessions are free and then the cost is determined based on income. I guess here is the answer to my question, why shared custody is more common in QC then in rest of Canada.

                            Comment


                            • #15
                              Originally posted by rthombe View Post
                              Well, I will likely go ahead and file the application anyway, just to see if I can bring her to the table to hear me personally. She won't talk to me about it right now -- just ignores my emails and calls. It will be months before an actual court date -- so they tell me -- so maybe once she's served and forced to respond, she'll see I'm really suffering here.
                              1. If you are "really suffering" you should seek therapy and not court to resolve your "suffering" problems.

                              2. You will lose and horribly and only get a costs award against you for attempting to use the court to "control" the other parent in the matter and "get what you want".

                              3. I do not recommend you file any application on what you are going to present an argument without at minimum discussing your matter with a qualified lawyer.

                              4. You can't use the court to improve parental communications and your attempt to do so and admission against interest on this very forum to do this is disturbing to say the least.

                              5. Move on with your life and seek financial counselling and theraputic for your "suffering". The public courts should not be used for what you are suggesting in the above quoted paragraph. You are clearly seeking vengence and to "be heard" and not solve a problem.

                              6. You are presenting an "emotional argument" really and trying to find "facts" to support your argument. This is rather transparent in your postings to say the least. You will be crushed in court not by the other party but, the justice hearing the matter.

                              7. If the other parent in this matter is reading this thread wondering if the poster is the other parent in their matter. This is why you should get an order from the court that there be no further motions without the leave of the court! You are about to be dragged into motion frenzy possibly and this is truly possibly the best example of "legal abuse" and an admission against interest to this pattern of behaviour of any poster I have seen contribute to this site since more resourceful days have past.

                              I implore you to really read your paragraph OP. I also encourage the more learned posters to not contribute as negative advocates to this posters admission against interest to drag a parent into court on such a matter and to recommend they seek "good advice" from a lawyer in the matter prior to seeking any vengeful remedy from a court to make the other parent "hear them personally" regarding this matter.

                              THIS IS NOT HOW THE COURTS SHOULD BE LEVERAGED AT ALL!

                              In support of my concern posted here regarding the OP I encourage everyone to again re-read this thread "When Helping Hurts":

                              http://www.ottawadivorce.com/forum/f...tes-not-13976/

                              Good Luck!
                              Tayken

                              Comment

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