How do you calculate the percentages of Section 7 expenses?

[representingself]

Lets say that Parent #1 makes $65,000 per year gross.... and Parent #2 makes $39,000 per year gross...

How do you do the math to determine who pays what percent of the "special expense"?


Does the Payor pay said expenses monthly, bi-annually or annually?

Do the parties have to agree to the expense beforehand?

Does the Payor require receipts?

 

[#1StepMom]

The calculation is simple:

Parent 1's Income + Parent 2's Income = Total Parental Income

To calculate each parent's respective percentage of special and extra-ordinary expenses, simply divide their income by the total parental income and multiply by 100.

In your case, Parent 1 would be responsible for 62.5% of the expenses, as 65K divided by 104K is 62.5%

How the payor pays the expenses is up to you to agree on. It can be done monthly (works well with daycare expenses) or annually or on a need-by-need basis (eg, braces).

The parties are always encouraged to agree to the expenses beforehand. However, if there happens to be a disagreement, and the recipient takes it to court, and the court rules the expense to be "necessary" the payor would be ordered to contribute his or her portion (percentage).

As for receipts, yes the payor would need receipts or invoices showing the costs associated with the expenses in order to pay his or her share.

 

[kamkatie]

Just as a quick addition. The net, not gross, costs should be taken into consideration. For example, with the Fitness Tax Credit, CPs can claim up to $500/child for sports.

So:
Hockey Gross: $500
Tax Credit $500X0.155 = $77.50 (the 0.155 is an example of mimimum tax rate)
Hockey Net: $500-$77.50=422.5

So Parent 1 would be reponsible for 62.5% or $264.07
and Parent 2 would be responsible for 37.5 or $158.43

Same kind of deal with daycare.

 

[#1StepMom]

Kamkatie is right. Don't forget about the tax rebates!

Another way to handle those is to share any tax benefits received with the other parent in the same proportions that each paid towards the expenses. Then, you only have to worry about the benefit payments once per year, when you get your tax return.

 

[workinginthesystem]

You asked if special expenses were paid monthly, bi-monthly etc. You can do it various ways. The best way is to figure out what your annual special expenses are, figure out his share, divide it by 12 and add it on to the monthly child support. That way, the maintenance enforcement people can just collect it for you.
However, many people don't know what those expenses will be. So, then you would give him the receipt as the expense arises, and he pays you back his share. Problems with that - hard to figure out the tax breaks on an expense-by-expense basis, and if he doesn't pay voluntarily, maintenance enforcement may not collect it for you (your order has to be worded just right for them to collect).
Your court staff will have a program to figure out the exact amount of child support, taking into account the tax deductions.

 

[representingself]

You asked if special expenses were paid monthly, bi-monthly etc. You can do it various ways. The best way is to figure out what your annual special expenses are, figure out his share, divide it by 12 and add it on to the monthly child support. That way, the maintenance enforcement people can just collect it for you.
However, many people don't know what those expenses will be. So, then you would give him the receipt as the expense arises, and he pays you back his share. Problems with that - hard to figure out the tax breaks on an expense-by-expense basis, and if he doesn't pay voluntarily, maintenance enforcement may not collect it for you (your order has to be worded just right for them to collect).
Your court staff will have a program to figure out the exact amount of child support, taking into account the tax deductions.

That is exactly my problem. The standard child support is rarely ever paid. As it stands, he pays less than 1/3 of what he was supposed to be paying for the past 10 years.

Our original order said nothing about any extra expenses and I only very recently learned that I could get help with such things, so I never asked. He has never paid a dime over the basic child support for anything...ever.

Going forward, I don't know how to work through this. I don't know what the expenses will be, so I can't come up with a number for FRO to enforce. I know if I just give him receipts, he wont pay.

As it is he wont even speak to me, (which makes it very difficult to self represent).

Option #1

I was thinking of proposing a bi-monthly claim, where I provide him with any receipts and he has 30 days to provide me with a refund.

Option #2

I thought of asking for an additional $25/month for his contribution towards the extras, which could be enforced by FRO, but he doesn't want to give me anything at all right now, so I know he wont go for that either.

Option #3

I am a stay at home mom, and my husband provides for 100% of our income. I receive very little in CS ($125/month), and get less than $100/month in CCTB. Our "household income" exceeds $80,000/year.

My ex works full time. His "household income" exceeds $90,000/year.

As I don't work, I assume that my ex would be responsible for most of the section 7 expenses for our child.

So I thought I would have a better chance with this option:

Ex pays 50% of any singular expenses in excess of $1000. With payments due either annually or bi-annually.

So basically unless there is a major expense like braces etc. he wouldn't have to pay any extra.

I would also like him to contribute to her post-secondary costs for College.

I would like him to pay 1/3,
I'll pay 1/3,
and our child will pay 1/3.

Questions:

How would I write up Option #3, plus the college savings into an Offer to Settle or Interim Order?

Am I being unreasonable?

 

[workinginthesystem]

You would word an offer to settle pretty well the same way you did in your message. As to wording of an order, you should speak to a lawyer or your court staff / law library, as orders differ by province.
You complain that he is not paying anything over the mandated child support amount. Actually, he isn't required to pay anything more right now - the court has set his child support amount and if you want more, it's up to you to get a new court order.
You should probably find out his income before you do anything. If the order amount is only $125 and your maintenance enforcement program is having trouble collecting even that, his income may be very low. If you take it back to court both the base amount and the special expenses are open to change. You have to decide if it's worth it.
As far as the special expenses, yes, normally they are divided proportionately to income. But if you are unemployed, the question comes up as to whether you are "intentionally unemployed" and if the court thinks that you are, they will divide the expenses as if you had an income. So, offering 50/50 is probably reasonable on your part. And your suggestion for dividing up post secondary expenses is a pretty common way of doing it.

 

[representingself]

You complain that he is not paying anything over the mandated child support amount. Actually, he isn't required to pay anything more right now - the court has set his child support amount and if you want more, it's up to you to get a new court order.

I don't mean to complain...it is just a statement of fact. When our child was smaller, I paid all of the daycare costs, because I didn't know any different.

You should probably find out his income before you do anything. If the order amount is only $125 and your maintenance enforcement program is having trouble collecting even that, his income may be very low. If you take it back to court both the base amount and the special expenses are open to change. You have to decide if it's worth it.

By no means is the man financially secure. He makes a meager wage (approx. $40,000/year). When the original order was written over a decade ago, we were very young, and he was making very little money. FRO has trouble enforcing the order because he doesn't want to pay anything at all. Until now, I have never sought any increases.

As far as the special expenses, yes, normally they are divided proportionately to income. But if you are unemployed, the question comes up as to whether you are "intentionally unemployed" and if the court thinks that you are, they will divide the expenses as if you had an income. So, offering 50/50 is probably reasonable on your part. And your suggestion for dividing up post secondary expenses is a pretty common way of doing it.

I am definitely "intentionally unemployed". I choose to stay at home for my children, so I don't expect my ex to pay for 100% based on my personal decision. This is why I want to propose a 50/50 split.

For all these years, I have been able to afford my childs' expenses and extra-curricular activities, and I don't expect my ex to make nickle and dime contributions.

My husband is more than happy to provide for his step-child.

I am most interested in assistance with her post-secondary education costs, (which gives my ex 7 years to plan/prepare).

I would like him to at least try and contribute 1/3 of her tuition so that she wont have to start out her adult life, buried in student loan debt.