After divorce, parents must still provide financial support for their children. Laws and court orders governing child support can be confusing, complex and viewed as being unfair. Generally, parents without physical custody must pay the other parent with custody until the child becomes an adult. Calculations are usually based upon the parents’ gross incomes after deductions for health care premiums and work-related childcare. Courts consider salary or self-employment earnings and may also include tips, commissions, bonuses and annuities.
New York and other states use a formula for setting child support to assure that the child is protected and supported. Deviations are prohibited unless a parent has extraordinary assets, health problems or there is another unusual situation. Divorce mediation can usually resolve most issues, except for child support. Even if both parents have joint custody, the parent with the higher income will pay more.
Child support is not limited to paying for food, clothing, health care and other necessities. Support is determined on the child’s reasonable expenses. These may include continuing their enrollment in a private school and basic entertainment expenses. The cost-of-living where the child lives, or any other special needs may also be taken not consideration.
But the parent receiving child support may decide how the money is spent. There is no monitoring on how it is used, and that parent does not have to report how the funds are spent. Parents who do not receive child support should keep track of the financial support they receive or provide. This documentation may be important if the other parent disagrees with their records or has late payments. There are legal penalties for late payments. Generally, however, these may be limited and time-consuming.
Taxes also play a role in related financial planning. Child support payments are not taxable income to the recipient parent and are not deductible to the payer. The parent who lives with the child for over half the year may claim the child as a dependent. A parent may transfer the exemption to the noncustodial parent. Finally, children must stay out of any child support disputes. Late payments are never grounds for blocking a parent from visiting their child.
It is not an easy task to arrive at a workable child support agreement. Thus, it may be necessary to obtain assistance. An attorney can help seek a fair and reasonable support order that protects the child’s interests. A lawyer may also address unique situations that arise.