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  • Undue hardship?

    Do I have a case for undue hardship with regards to paying child support?

    My ex and I have 50/50 custody of our 4 children (ages 21, 16, 12, and 7). I now earn $42k more than the Ex. However, I commute 90kms more a day and my defined benefit plan contribution rate is about 3% more than hers (yes, she has one too). My new raise nets $120 a month and she gets $65 of it from child support offset (leaving me $55). This raise also affects my rate for paying extraordinary expenses, and since we have three kids in sports and activities, that extra $55 is probably more like $45 for me and more like $75 for the ex.

    Thankyou

  • #2
    - The DB plan rate is too small to be significant.
    - 90km commute - is that new? It's nasty, but not out of the ordinary for a major city. That's about 21K km's/year, which is probably costing you about $5K/yr ($2500 gas + $2500 depreciation) - assuming you are driving. Is car-pooling/transit an option?

    The numbers you give are bang on with the guidelines i.e. starting from $80K income, a gross monthly increase of $240 ($120 net of Tax/DBplan) corresponds to a $54/month increase.
    And at 38K/80K, adding $3K to your gross income is only going to increase your % of S7 by 1%.

    All I can suggest is that you (both) cut back on the sports/activities - it seems you are spending over $10K/year on this? Perhaps phrase it that you need to focus on saving for the younger kids' university expenses.

    I'm not seeing any undue hardship claim reasons - you just have 4 kids and you are spending loads on S7.

    Are your access costs very high, perhaps as a result of needing to take a job further away?

    Have a look here for some ideas: http://www.justice.gc.ca/eng/pi/fcy-...ep8-etap8.html
    Last edited by dinkyface; 04-09-2013, 06:33 PM.

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    • #3
      Then again, with $38K/$81K gross incomes,
      - subtracting income tax/CPP/EI/CS offset payment, $10K total S7 costs,
      - subtracting 5%/8% DB plan contributions,
      - subtracting your extra 5K commuting costs,
      - assuming she is claiming the kids as eligible dependents,
      - ignoring new partners' incomes(?),
      Your net disposable incomes are $43.8K/$29.4K (in her favour).

      I have a hard time seeing how you and (half of) 4 kids can survive on 29K, whereas it is doable for her on 44K. Then again, I pulled the 38/81 incomes out of thin air.

      Perhaps that is enough of a discrepancy to make it worthwhile?

      Are there new partners?

      Perhaps search on www.canlii.org for 'undue hardship' 'standard of living'?
      Last edited by dinkyface; 04-09-2013, 07:12 PM.

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      • #4
        I would be interested in this as well.

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        • #5
          Is the 21 year old in full time post secondary? If not, then you should not be paying support for that child as they are over the age of majority.

          What are you paying in CS at present? Are you using the offset method or are you paying full table? What are you paying for in terms of special expenses?

          With the information you have given, no you don't have grounds for undue hardship...it's retardedly difficult to pull off.

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          • #6
            My understanding is that undue hardship is for extreme cases which are completely outside your control, like losing your job or having a major health crisis. A long commute is no fun, but it's not outside the realm of ordinary life these days. If the S7 expenses are burdensome, it sounds like you might need to bite the bullet and tell the kids you're going to have to cut back on them.

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            • #7
              Do I have a case for undue hardship with regards to paying child support?
              No. Undue hardship occurs when you do not have enough money to sustain yourself.

              Your long commute will be credited to you in your tax return, as wear and tear on the vehicle, repair costs and gas, which should be reflected in your overall income.

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              • #8
                Originally posted by OrleansLawyer View Post
                Your long commute will be credited to you in your tax return, as wear and tear on the vehicle, repair costs and gas, which should be reflected in your overall income.
                Only if he is self employed, and even then at most half of the commuting fuel/insurance/repairs/lease could be used ... and as a deduction, not a credit.

                So it would give him about $875 refund (5K * 0.5 * 0.35 marginal tax rate).

                Read the CS guidelines and the case law on CANLII for more info. The bar is set very high for undue hardship.

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                • #9
                  Thanks for the input folks. My income is slightly over 100k and am paying CS based on the offset method. I do not live in the GTA, my youngest is in after school daycare (5:30pm pickup cap), and I make up for lost work time on the weeks without kids, so I can't take public transit or carpool. I have spoken to a lawyer via my company's EAP and she said that I don't have a case for undue hardship because I CAN support myself and the kids.

                  However, she did say that I can file a motion to change child support payment amounts citing material changes from the time the original separation agreement was drawn: we did not anticipate that our income levels would diverge so much and the costs of operating a vehicle (gas prices) have increased significantly over the last 4 years. I am also servicing a debt that is over $30k (She got my RRSPs, I got the debt) - not including my mortgage.

                  In a nutshell, I need to prove that her standard of living is now better than mine. Am I out to lunch going down this road?

                  Comment


                  • #10
                    Originally posted by MikeAtWork View Post
                    ...
                    In a nutshell, I need to prove that her standard of living is now better than mine. Am I out to lunch going down this road?
                    And this is unreasonable because?? Why do you have to have the same standard of living as someone you are not married to?

                    However, CS should be based on actual incomes and adjusted yearly.

                    If there is SS, then you should follow the SS agreement.

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                    • #11
                      Originally posted by MikeAtWork View Post
                      However, she did say that I can file a motion to change child support payment amounts citing material changes from the time the original separation agreement was drawn: we did not anticipate that our income levels would diverge so much and the costs of operating a vehicle (gas prices) have increased significantly over the last 4 years. I am also servicing a debt that is over $30k (She got my RRSPs, I got the debt) - not including my mortgage.

                      In a nutshell, I need to prove that her standard of living is now better than mine. Am I out to lunch going down this road?
                      For undue hardship, you have to prove that you can't live AT ALL with the money you currently earn, due to the CS payments. From what I hear, it's hard to do. And probably completely impossible for someone who makes six figures.

                      You have other avenues open to you first anyway.

                      You say that when you drew up your agreement, you didn't anticipate that income levels would diverge? What divergence has happened? Are you not adjusting CS annually based on your tax returns?

                      Secondly, the 21 year old. If this young adult is not in full-time education, you should only be paying for three kids, not four.

                      Next, your commute. There's where a good portion of your income is going. You really need to look into ways to change that. Can you do a compressed work week? Can you telecommute? Can you trade down to a more fuel-efficient vehicle? Can you move closer to your job? Can you find a different job?

                      Equalization seems to have been messed up, if she got the RRSPs and you got the debt. There must have been a good reason for this at the time? Unless you can reopen this for some reason, you're probably stuck with what you agreed to then and can't really be whining about it now. I suppose there might be a slim chance to argue here if you are stuck with disproportionate marital debt due to circumstances that were beyond your control at the time.

                      Section 7. If you can't afford to pay for them, you have to enrol your kids in fewer sports and activities. It's just how life works.

                      Do all those things first, and THEN if you still can't afford CS and still eat, you can try to claim undue hardship.

                      Undue hardship is really for a situation where a parent with less than 40% access is paying full CS to an ex with far greater income. Not for two parents with shared access who have good incomes and one of them is simply living beyond their means.

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                      • #12
                        Does anyone know if when claiming "undue hardship" ALL household income is considered? I seem to recall reading that at some point but I'm not certain.

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                        • #13
                          Originally posted by arabian View Post
                          Does anyone know if when claiming "undue hardship" ALL household income is considered? I seem to recall reading that at some point but I'm not certain.

                          Yes Arabian, you are right, all household income counts.

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                          • #14
                            Originally posted by billm View Post
                            And this is unreasonable because?? Why do you have to have the same standard of living as someone you are not married to?
                            In a shared custody situation, it is very unreasonable for the parent receiving child support to have a higher standard of living. It means that you are hurting the children while they are spending time at the poorer household to help the richer household, which is completely contrary to their best interests.

                            That is assuming that you believe that CS is supposed to help the children of course. If you see CS as the right of the recipient, then I guess it makes sense.

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                            • #15
                              Originally posted by MikeAtWork View Post
                              In a nutshell, I need to prove that her standard of living is now better than mine. Am I out to lunch going down this road?
                              If you are still asking, I'm guessing you did not do the suggested reading on www.canlii.org (searching for 'undue hardship' 'standard of living').

                              Comment

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