Child Support: How Does It Work? How Much Will It Cost?
Parents’ obligation to pay child support takes priority over all other financial obligations, which is why parents may be thrown in jail for failing to pay child support. No other failure to pay a financial obligation carries such a steep penalty. A parent may not claim the protection of bankruptcy or seek forgiveness of unpaid child support. As a matter of principle, many parents would prefer to pay directly for things their children need instead of giving money to the other parent. However, child support must be paid in cash, not gifts or payment of direct expenses.
As a starting point, the federal guidelines are based on a 2009 report from the Center for Policy Research, http://www.centerforpolicyresearch.org/
a private nonprofit research agency based in Denver. Every four years each state is required to review and update the guidelines based on changes in the cost-of-living. In Arizona, the child support guidelines changed on July 1, 2015 to provide a higher self-support reserve for the paying parent.
• To make support orders consistent.
• To get parents’ and courts’ guidance in establishing the child support (promote settlement).
When does child support end?
In Arizona, child support ends when the youngest child turns 18 and graduates from high school. If the child has not graduated from high school at 18, child support will last until the child turns 19 (rounded up to the end of the month).
This is not the case in many other states. Some states require a parent to pay child support while they are in college. If your child support order began in another state, it may continue through college. This is certainly something to check with an attorney about.
It is also possible to receive child support for a disabled child beyond the age of 18. For this issue you will definitely want to consult with an attorney.
What counts as income for child support purposes?
To determine your income and the opposing party’s income for the child support calculator, you should include income from all sources, including:
• Income from salaries
• Severance pay
• Trust income
• Workers’ Compensation benefits
• Capital gains
• Spousal maintenance
• Unemployment insurance benefits
• Disability insurance benefits, including Social Security Disability benefits.
This is not an exhaustive list, meaning that just because a particular income source isn’t listed here doesn’t mean it won’t be included as income for child support purposes.
What is excluded as income?
• Child support
• Food stamps (the SNAP program)
• Temporary Assistance for Needy Families (TANF)
• Supplemental Security Income (SSI) (money given to low-income individuals who have never worked or who haven’t worked enough to accumulate benefits.)
What about overtime, seasonal work or other income that is uncertain for the future?
Sometimes people work a lot of overtime in a certain season. Accountants work more hours during tax season than the rest of the year; certainly they should not be made to work 80 hours a week all year only to pay for child support. Or, consider a person who works many overtime hours during the Christmas season at UPS. They cannot be expected to continue to earn income at that rate throughout the year.
The guidelines state that the court should not consider overtime. Each parent should have the choice of working additional hours through overtime or a second job without increasing child support, except if that overtime was historically earned and is anticipated to continue in future. Seems a bit contradictory, doesn’t it?
This means usual or expected overtime can be considered when determining child support, but not when overtime would require an extraordinary work regimen. This must be determined given the actual facts of the case, the occupation, and the working hours and conditions involved.
For instance, firefighters might work four twenty-four hour shifts and then have four days off. This is the schedule for all firefighters in that division and is expected to continue. The firefighter always received overtime and is always expected to work overtime. Their income, including any overtime pay, should be included in the child support calculation.
On the other hand, consider a restaurant server. A server may be working an average of five shifts per week. During spring training, they may end up working eight to ten shifts per week. The courts should not assume the server will continue to work eight to ten shifts per week and should instead attribute a reasonable average when determining the income of that parent.
How do I find out how much my ex makes?
In any case, each party must provide an Affidavit of Financial Information. Typically, this provides all the information you need. In some cases, it is not enough and you need to use additional discovery tools to find the information you need.
Once a child support order is entered, the court is required to order that the parties exchange financial information like tax returns and earning statements. You are also required to exchange residential addresses and the names and addresses of employers. If there have been significant changes in income or other factors, you may want to seek a modification.
What if the parent is self-employed or owns a business?
Business owners have a great deal of control over what they pay themselves as income. It can be very difficult to determine the correct amount to use for child support purposes. It wouldn’t be fair to consider all of the income earned by a business as income to a parent, just as it wouldn’t be fair to consider only the net number after all expenses have been paid.
For income from self-employment, rent on a rental property, or joint ownership in a business, income is considered to be gross revenue (all money brought in the door) minus ordinary and necessary business expenses. Often, the best starting place is income on tax returns. However, this is only a starting place. A parent may be able to deduct expenses for tax purposes that should not be deducted for child support purposes. For instance, payment for a car or phone or internet at your house may be deductible for IRS purposes, but should not be deducted for child support purposes because all parents typically have the cost of cars, phones and internet.
What if a parent is voluntarily unemployed or underemployed?
If a parent is unemployed or underemployed, the court has the discretion to consider the reasons. The court should look to whether the underemployment is reasonable. A mom with a newborn could reasonably take time off or reduce her workload. A father who moves to be closer to his children may voluntarily reduce income while seeking new state licensure. This could be reasonable under the circumstances. The court should weigh the costs and benefits of the parent’s choice and the reduction of child support in light of what is in the best interest of the children.
Income of at least minimum wage for full-time employment should be attributed to both parents. With that being said, if a parent is home taking care of small children and the court attributes wages to that parent, be sure to ask the court to also attribute the child care costs associated with full-time work. There are circumstances when a court need not attribute income to a parent. Examples might include:
• A mentally or physically disabled parent
• A full-time student (if the court determines the schooling is reasonably calculated to enhance earning capacity)
• Extraordinary emotional or physical needs of a child that require a parent to stay home to care for the child
If the court attributes or imputes income higher than minimum wage, the court must make findings on the record and explain the reasons for the decision to attribute the income.
What about the income of roommates or new spouses?
Only the income of both parents will be considered when calculating child support. Since only legal parents have the legal responsibility to support the child, other sources of support like grandparents, new spouses, or roommate contributions will not be considered. The amount of property a parent owns will not be considered unless the property produces income.
What about income taxes and other non-voluntary reductions in pay?
Child support obligations are based on net income. The impact of taxes has been considered. If you are in a position where non-voluntary reductions of pay extend beyond typical taxes, you will want to make sure to bring this to the attention of the court.
People who work for the state of Arizona are required to contribute 11.5% of their income into a non-voluntary retirement system. People employed by the state should consider asking the court to factor in this non-voluntary contribution when determining child support.
Other than income, what else is considered when determining child support?
1. Other Children
Non-joint children or “children of other relationships” refers to your legal children who are not subject to this child support order. Your obligation to support your other children is factored into your overall child support obligation to each child. To determine the amount of the deduction, you can look to the tables and find your income and the corresponding cost for the number of children you have.
2. Court-ordered child support
Additionally, if you are paying child support to other children, that court-ordered support is deducted from your income available to pay to the current child.
3. Court-ordered spousal maintenance
Spousal maintenance paid is deducted from income by the paying parent and attributed to the income of anyone receiving spousal maintenance. Arrearages (unpaid amounts owed) are not deducted or included. That means if you are receiving $500 per month spousal maintenance and an additional $200 in arrears is owed to you, your income (in the child support calculator) will only increase by the $500 court-ordered maintenance amount.
After the incomes of both parents are established, the court determines the overall child support obligation based on the combined income. The maximum combined income that is considered is $20,000. Then the court determines the proportion that each parent should contribute.
Note: If you would like the court to consider income above $20,000, you will have the burden of proving the standard of living the children would have enjoyed if the family lived together, and any additional expenses of the children, that would create a need for increased child support. Essentially, the court has the ability to order an upper deviation based on income over $20,000. But if you are seeking this deviation, you must prove that it is appropriate in your case. This is to avoid a child support obligation of $10,000 a month from an NBA superstar to his mistress, for example.
After the basic obligation is determined, other factors will modify the total child support amount.
The cost of medical insurance
The cost to insure the child for medical, dental and vision insurance is added to the initial obligation. This is not discretionary. Notice this is only the cost to insure the child. As an example, if it costs $100 for the mother to insure herself, and an additional $100 to insure all dependents, the cost of medical insurance for one child would be one hundred dollars divided by the number of dependents.
Who pays for health insurance?
The order for child support should include an order of who must provide health insurance for the children. To determine who must provide insurance, the court will look at who has the ability to provide insurance either through their employer or another source. If both parents can and want to provide insurance, the court will usually order the custodial parent or the parent who has more time with the children to provide insurance.
Who pays for uncovered medical expenses?
The court will also specify what portion of uncovered medical expenses each party must pay. Only medically necessary medical expenses are subject to reimbursement from the parent who got the services. What is medically necessary is subject to much debate and is decided on a case-by-case basis.
How do I seek reimbursement?
Generally speaking, a parent must provide the request for reimbursement of the uninsured costs within six months or 180 days of the date of services. The other parent should then pay his or her share within 45 days of the receipt of the request. The guidelines do not state that the parent who provided the medical coverage must provide receipts, only that they must request payment. However, the parent should be prepared to provide receipts of the actual services rendered.
What if one parent does not use services covered by insurance?
Each parent is required to use their best efforts to obtain services covered by insurance. If a parent has used non-covered medical services, then actual receipts of services are required to be provided to the other parent.
Discretionary adjustments to the child support obligation
1. Childcare costs
In practice, courts almost always consider childcare costs when determining the transfer obligation. Based on the rules, this is discretionary, meaning the judge does not have to adjust child support based on the cost of childcare. When determining whether the childcare costs are appropriate, the judge will look at the parents’ financial abilities. It would not be appropriate for a parent who is earning $10 an hour to hire a nanny at $10 an hour.
The court also considers that a parent paying for childcare will be entitled to a federal tax credit. The court is specifically authorized to adjust the childcare costs based on who will be receiving the tax credit.
Additionally, the court should take the childcare costs and average them throughout the year. Many people have increased childcare costs during the summer when the children are not in school. Consider adding up what you spend on childcare during the entire year and dividing it by 12 when using the child support calculator.
2. Educational Expenses
Educational expenses, like the cost of private school, tutoring, or special educational classes outside of the regular school day, can be considered when determining child support. However, one parent may not unilaterally decide to sign up a child for Japanese lessons and seek reimbursement. These activities need to be agreed upon by both parents or ordered by the court.
3. Extraordinary Child Expenses
Remember, the guidelines were designed with the average child in mind and the expenses associated with that child. If your child has extraordinary needs and therefore extraordinary expenses, you can ask that the court adjust the child support obligation in accordance with these special needs.
4. Older child adjustment
Children over the age of 12 cost more than children under 12 by about 10%. The court can adjust the basic obligation by 10% for all children over the age of 12. For instance, if the child support obligation for a 14-year-old is $400, the court can increase the obligation to $440 due to the child’s age. If the total obligation for three children is $1200 and one is over the age of 12, the court would add 10% only for the older child (1200/3 = 400)(400 + 10% = $440). The total obligation would be $1240.
What is each parent’s responsibility?
At this point, we have determined the overall obligation to support the child. Both parents share the responsibility of support, so the overall number will be allocated between the parents in proportion to their income. For example, if Mother earns 60% of the combined income, she will be responsible for 60% of the $1240 obligation described above.
Parenting Time Adjustments
Up until this point, we have only determined what percentage of each parent’s income should be spent to support their joint children, with no adjustment for who actually pays the expenses. The parenting time credit seeks to ensure that the custodial parent is reimbursed for the day-to-day expenses incurred.
In order to calculate the number of days that a non-custodial parent has the child, the court adds together the various blocks of time the parent spends with the child. A block of time starts when the parent receives or returns the child from school, childcare, or the custodial parent. As a general rule, a non-custodial parent is not credited for time the child is in childcare or school. A period of 12 or more hours with the non-custodial parent is one day, 6 to 11 hours is a half-day, 3 to 5 hours is a quarter-day, and 3 hours or less could be a quarter-day if the parent is providing for routine expenses like meals. This is an attempt to be fair if you have a non-custodial parent who is providing after-school care for the child up until bedtime every day.
For example, if the parent picks up a child at school at 3 o’clock Friday and then drops her child off at school on Monday morning, the parenting time credit would be 2.5 days.
Once the total number of days is determined, the support obligation is adjusted according to parenting timetables A and B, which can be found in the child support guidelines.
If parenting time is equal, no adjustments are made and the child-support obligation is shared in proportion to the parents’ income.
As we mentioned above, the self-support reserve was increased when the 2015 child support guidelines were modified. Even though child support is considered a parent’s primary financial obligation, the self-support reserve test is to make sure that the non-custodial parent can take care of himself or herself at a minimum standard of living. For parents with very minimal income, the child support obligation will be adjusted down to account for their self-support reserve.
Sometimes parents with multiple children will have divided custody, meaning each parent may be the primary custodial parent to one or more of the children. When that is the case, create two child support calculations and determine the difference. For instance, if the mother has primary custody of one child and the father has primary custody of one child, you can prepare two child support worksheets (one for each parent) that each assume one joint child. The difference between the amounts owed will be the child support ordered.
Travel expenses are not factored into the child support calculator or obligation. They must be assigned to the parents separately, either in a divorce decree or a parenting plan/custody decree.
Child Support Deviations
A deviation from the child support guidelines occurs when either the judge orders, or the parties agree to, an amount that is different from the guidelines explained here.
The judge can accept a deviation that has been agreed to by the parties only if the parties have entered into a binding Rule 69 agreement, with the knowledge of what the child support would have been under the guidelines. (For an explanation of what the Rule 69 agreement is, click here).
The court can deviate from the guidelines after they have considered all factors and they meet the statutory requirements. A judge must make findings on the record as follows:
1. That the guidelines are inappropriate or unjust in a particular case.
2. That the court has considered the best interest of the child or children in determining the amount of the deviation.
3. That the court has completed the child support worksheet and provides the presumptive amount under the worksheet and after the deviation.
In fact, the court must make findings in all child support orders regarding the gross income of both parties, the adjusted gross incomes, the basic child support obligation, the total child support obligation, and each parent’s proportionate share of the child support obligation. If the judge includes a child support worksheet, it is assumed that the numbers used in the worksheet(s) constitute the judge’s findings.
What if the child doesn’t live with either parent?
Sometimes a child may live with grandparents or other third-party caregivers. In that event, those third-party caregivers are entitled to receive child support from the legal parents according to the guidelines explained here. In order to receive the support, the third party must seek a child support order from the court by filing a petition for child support and naming both the legal mother and father in court action. The third party would then be required to appear in court or get a stipulated judgment for child support.
If the office of child support enforcement (DCS or Division of Child Support) is involved in your case, you have an IV-D case. That means the state is a party to the action and must be served on all court paperwork, including modifications.
Modifications of Child Support
There are two ways to seek a modification of child support, the standard and simplified procedures.
Through the standard procedure, either parent or the state may request a modification by alleging and proving a substantial and continuing change of circumstances. A change in circumstances could be due to a parenting time change, a relocation, change in incomes of the parties, birth or adoption of additional children, or any combination of the factors outlined here.
The simplified procedure allows a party to request a modification of an order based on a change that would cause child support to change by 15% or more. This is evidence in and of itself of a substantial and continuing change in circumstances. Your petition to modify must be accompanied by a completed child support worksheet and supporting documentation of the figures used in the worksheet titled “Parent’s Worksheet for Child Support Amount.” If you don’t have documentation, don’t worry; you may still request the modification and simply indicate to the court your estimate and the basis for the estimate.
After you file documents and serve the other party, you don’t have to do anything. The other parent is required to request a hearing within 20 days if within the state of Arizona, or 30 days if the parent lives out of state. If no hearing is requested, the court will either modify the child support with the information provided in the petition, or will set a hearing. If either party requests a hearing, one will be set before child support is modified.
You must seek a modification of child support when one of your children turns 18 and graduates from high school. The child support obligation is not automatically reduced by that child’s proportion of the amount.
Federal Tax Exemption
Parents can claim the federal and state tax exemptions for their minor children according to their agreement. If the parents do not agree, then the court will determine who may claim the federal exemption based on each parent’s adjusted gross income. If both parties have substantially similar gross incomes, they may alternate every other year on who claims the tax exemption. If Father earns twice as much as Mother, he may claim the child two out of every three years. This is very frustrating for many parents, especially the custodial parent who may earn less. However, it is designed to maximize the communal benefit to all parties. If a parent is behind in paying child support, they are typically prohibited from claiming any tax exemption.
Child support arrears
Child support arrears occur when a parent has not paid all of the court-ordered child support. The amount owed is called the arrears. The court will set not only your child support obligation, but also a payment on the arrears balance, which accrues monthly interest. If a child turns 18, which is when the child support obligation would typically end, but a parent owes arrears, that parent’s child support obligations will continue until the total amount owed (arrearage) is paid.