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Shocking News About Child Support Calculations

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  • Shocking News About Child Support Calculations

    I spent an hour discussing this with our lawyer the other day, trying very hard to understand how child support calculations work. I was shocked that my original straight-forward belief was incorrect.

    I thought I'd share what I learned during the conversation, because I know many of us share the same "last year's income = current support amount" belief, which is in fact incorrect. (Go figure!)

    The way our lawyer explained things...

    Child support is not necessarily calculated in the way in which we always thought, that is that in June, you look at your total income on your previous year's tax return, and in July you adjust the amount based on that income.

    The courts look at child support on a yearly (January-December) and "current" basis.

    For example, if in 2009 your income on your 2008 notice of assessment was $30,000 and as a result you were paying child support based on $30,000 in 2009... then when you obtain your 2009 income in 2010, and it shows that you made MORE than $30,000 in 2009... you will be in arrears as what you paid in 2009 did not match your actual 2009 income.

    Similarly, if your 2009 notice of assessment shows that you made LESS than $30,000... you will have overpaid and *should* receive a credit in child support.

    Does that make any sense to you?

    Basically, the courts want you to pay in a given year the amount you should be paying based on your "current" income that year. And since "current" income is not always available, judges may project an income and base your child support on that (from your most recent paystub) or they can use your previous year's income and make adjustments in the future to see whether or not you paid accurately.

    Personally, this to me makes no sense.

    I always thought that you used last year's income tax total income, and paid according to that, and each year you adjusted the support based on the next income tax return.

    Supposedly I was wrong.

    Has anyone else been explained child support calculations in this way?

  • #2
    Yes and no (been explained this way).
    If we go as far as court, the judge would look at different factors which could include last 3 years, it could include month by month for the current year, etc. The judge has discretion to look at it differently depending on the situation, type of job, variations in income. The judge may include bonuses and overtime, or exclude them, depending on what the arguments are from each side.

    People don't (usually) go back to court every year, so going forward there has to be a rule made, and you follow that rule.

    If you negotiate your own settlement you put in your own rule. The Separation Agreement we are negotiating right now says, line 150, after we get our assessments back each year we set CS from July-June. This is something we work out and if we sign that's how we'll do it.

    If we can't agree and go to court, we'll ask the judge to decide how it's updated every year.

    AFAIK the default is, receiving spouse is to ask for tax assessments every year, and the paying spouse has 30 days to provide. There is no law that says a paying spouse declares their income every month, or reports changes to the receiving spouse immediately.

    The receiving spouse can go to court any time if there has been material change (which would include change of income) but it would be ridiculous to go to court each year, or each 6 months, or however often income changes for some people.

    We all need to have a rule or system to follow to update changes, but that isn't going to be the same for every couple.

    Comment


    • #3
      YES it is correct

      If you think about it logically, it will make sense to you. If you get an increase within the taxation year, your income goes up and you remain at the same payments for the children, well that isnt right. So yes arrears makes sense.

      I have to pay child support because my ex has alienated my children from me so he could get child support.

      I do not begrudge any laws pertaining to the children, it is for them, but I know he will spend some of it on beer. Sad but true.

      Comment


      • #4
        But OP's lawyer is saying that CS paid during 2009 is based on 2009 income (assuming not using 3yr average).

        This is incredibly impractical because
        1) Most will not know their 2009 income until 2009 is FINISHED. So every January, each party has to give the other a GUESS on what their income will be for that year?
        2) It then implies that an adjustment payment is made in 2010, either in January, if both parties are trusting (Hah!), or in May/Jun when tax assessments are received.

        Who has heard any noise about these adjustment payments? No-one! They don't happen!

        Comment


        • #5
          My Husband pays on a yearly salary Jan - Dec. However, in July, when income tax returns arrive, he adjusts the payments from Aug - Dec. if need be to make his payments for the year equal the appropriate table amount.

          This works pretty well, except sometimes the income will go down, not up for those 5 months, which can be an issue. If payments increase, there has never been an issue . Then in Jan - July he goes back to the original amount, and then adjusts again next Aug.

          This is in his separation agreement, so there has never been a trip to court, we just had to prepare a spreadsheet one year (when $$ went down), to satisfy the ex that everything was as it should be. Much cheaper than using lawyer for this kind of thing.

          Comment


          • #6
            Got2bkid, that sounds like a good practice. Does your hubby have to deal with FRO at all? Because we've been told that in order to make an adjustment with FRO you need a court order which means going back to court.

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            • #7
              No, we don't deal with the FRO, thank goodness. However the ex uses it for leverage "if you don't pay XXX for that I am going to registar with the FRO" for example. It's funny that a program that is designed to "help" divorced couples is actually used as a threat.

              Comment


              • #8
                The program is not there to help divorced couples, it's there to enforce support orders. It is there primarily to ensure that children are supported.

                Comment


                • #9
                  Originally posted by dadtotheend View Post
                  The program is not there to help divorced couples, it's there to enforce support orders. It is there primarily to ensure that children are supported.
                  In theory... ;-)

                  Comment

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