In the second part of this article, we will be looking into what counts as income, which can help to give you a better idea of what the child support will be, whether you have to pay or you are receiving it. We will also learn more about what happens if the non-custodial parent has trouble making the child support payments.
What Counts as Income?
The first input into the calculator, discussed in Part 1 of the article, is income for both of the parents. Essentially, anything will count as income toward this calculation. This includes salary, unemployment, bonuses, severance pay, capital gains, annuities, disability benefits, and spousal maintenance. If the money is something that the tax code would deem income, it will count when calculating the overall amount of income for child support.
It’s also important to know what is not included in the calculations. Food stamps, Temporary Assistance for Needy Families (TANF), and SSI will not be included. If you get child support for other children that you have from a different partner, this will not be calculated as part of your income.
What If You Don’t Work and Will Receive Child Support?
Perhaps you aren’t working because you are a stay-at-home mom. How will your income be calculated if you don’t have any?
In Arizona, if you do not work, the state will impute the income. This means that they will assume that you can work if you are not disabled or unable to work for another reason and will attribute what you would be making if you had a job. Most of the time, they will be imputed full-time work at minimum wage to calculate what their income would be.
If you are imputed and you have young children, you should ask the court to consider what the childcare expenses would be, which could help you to receive more in child support.
What About Overtime or Commissions?
Sometimes, people work a lot of overtime during certain seasons, but not during the rest of the year. For example, someone who works at UPS might take on a lot of overtime hours during the holiday season. It wouldn’t be fair for the state to attribute that amount of income to you for the entire year.
The guidelines state the overtime should not be considered unless it is historically earned and can be anticipated in the future. It’s important to understand that this is somewhat of a gray area and is discretionary for the judge.
You may want to talk with an attorney to see if they have any insight on your overtime or commissions that you make from sales to see whether this may or may not be included as part of your income.
The Affidavit of Financial Information
Both parties that are involved are required to provide an affidavit of financial information. This is a sworn statement. It means that you are swearing to the courts that all of the information found within the affidavit is accurate and correct.
The information in the AFI will be your budget, including how much income you get, the sources of the income, how much is spent on things like health insurance and food, for example.
Additionally, both parties will have to include their tax returns, W-2s, and 1099s. Most of the time, the AFI document will provide you with the information you need to determine your ex’s income unless they are hiding some of their income.
If you feel as though they are not being honest about their income, there are discovery tools that can be used. It may be a good idea to contact an attorney at this point.
After a child support order is entered, the court is required to order that the parties exchange this financial information every two years to see if there are changes. It will usually be required to provide your residential address and addresses of employers, as well. If there has been a major change, you can always go and modify the child support. Keep in mind, you can also track and submit payments in your state with a child support login on the corresponding states DCSS website.
What If Someone Is Self-Employed?
Many people today are self-employed, and this can be tricky in terms of child support. The starting point is to use the income that’s stated on the tax return. However, this is just the start.
It wouldn’t be fair to consider all income earned by a business to be considered as income since that’s not how the IRS looks at things. It’s not always clear and easy to determine what your income is when you are self-employed, at least the way the family courts look at it. You will often have to go through all of the information to determine what the income should be. It could be easier to do if you have the help of a professional who has worked with others who are self-employed.
What If Someone Can’t Pay Child Support?
In some cases, a non-custodial parent might lose their job and wonder how they are going to pay child support. Just because you lose your job doesn’t mean that you can stop paying. After all, unemployment is still considered income. The amount that you have to pay might not line up with the smaller amount that you are getting from unemployment, though, and this can cause problems.
In those cases, it’s best to seek a modification of the child support order that will reflect whatever changes have happened in your life that affect your finances. The modifications are based on financial information, so you will need to have records that show there has been a change in your situation and that you can’t pay the current amount.
If you are the custodial parent who is supposed to receive child support and your former partner isn’t paying, you will want to talk with them about the problem and let them know that you will be going to the courts if they don’t pay. Often, this is all it will take to get them to start paying again or to seek the modification. As with many elements of child support, it is often a good idea to talk with an attorney about your options.