The question often arises whether a stepparent has any responsibility to pay child support for their stepchildren. The general rule is that a stepparent has no duty to pay child support for their stepchildren. However, practically speaking, if your stepchildren do not reside in your home, i.e., if you and your spouse or partner do not have residential custody of your stepchildren, then income that would otherwise be devoted to your household is being paid out to the parent of primary residence. It should be made clear that the income that is being paid out, and upon which child support is being calculated is solely your spouse’s or partner’s income. For example, if you make $75,000 a year and your spouse or partner makes $50,000 a year for child support guideline purposes your household income is $50,000 a year. Continue reading →
In a typical New Jersey case a parent cannot be forced by the court, or the other parent, to contribute to the cost of a private school education. However, if the parents combined net incomes are above the child support guidelines cut off contribution to private school costs will usually be ordered.
Parental Incomes Above Child Support Guidelines Cut-Off
The New Jersey child support guidelines only cover situations where the parents combined net incomes are equal to or less than $3600 per week ($187,200 per year). It should be emphasized that the income cut off is a net income cut off, meaning an after-tax, after worksheet deduction, income. If the parents combined net incomes are $3600 per week or less the child support worksheet should be utilized. If the parents combined net incomes are more than $3600 per week the child support guidelines worksheet should be used to calculate the child support at the $3600 per week income number. The court can then fashion other appropriate support, on top of the basic guideline support, for any combined parental income above $3600 per week. It is this other appropriate support on top of the worksheet support that can be used to pay private school expenses. An example may help illustrate the concept. Continue reading →
A basic question in a New Jersey child-support case is which expenses are covered by child-support? Does child-support just cover food, shelter, and clothing for the child, or is it supposed to cover vacations, dance lessons, sports activities, and other non-basic expenses? I’m often asked by the parent who is paying child support if they have to provide money on top of the child support paid for their children’s entertainment expenses, car insurance, footwear, extracurricular activities, sporting equipment, and other expenses. The answer is generally no, unless they agree to contribute to those expenses. The New Jersey child support guidelines are very specific regarding what expenses are covered by child support.
According to the New Jersey child support guidelines all children’s clothing, (including school uniforms) are included in child support. Similarly, all children’s footwear (except special footwear for sports) is included in child support. So technically, after paying child support, the non-custodial parent has no obligation to pay for any clothing for their children (except sports footwear) as the child’s clothing is covered in the child support payment. Continue reading →
Custodial parent’s in New Jersey are often surprised to find out that even if they are deemed the custodial parent by a family court they are not automatically entitled to claim their children as tax exemptions each year. The New Jersey courts treat the issue of custody and who can claim the children as tax exemptions as separate but related issues. The leading case which discusses allocation of child tax exemptions in New Jersey is Gwodz v. Gwodz, 234 N.J. Super. 56 (1989).
In the Gwodz case the husband and wife had a property settlement agreement which resolved their divorce without a trial. The parties agreed that wife would have custody of their two children. However, for whatever reason, their written settlement agreement made no mention of who would be able to claim the children as tax exemptions each year.
A few years after their divorce the husband filed a motion seeking, among other relief, that he be permitted to claim both children as tax exemptions. The court issued an order which allowed each party to claim one child as a tax exemption each year. The wife appealed the judge’s decision to the appellate division. Continue reading →
Generally speaking, in a New Jersey divorce, the parent who has to pay child support is required to carry life insurance. The rationale for requiring the person paying child support to maintain life insurance is that the child support obligation is a multi-year obligation. If the person paying child support dies without life insurance there will be no stream of income to cover the expense of raising the child to adulthood. If there is a life insurance policy in effect there will be a pot of money if the parent dies to support the child throughout their developmental years. The amount of life insurance that the paying parent has to obtain is usually based on the projected cost of child support over the years that it will be paid. The amount of insurance will also include an estimate of the parent’s projected contribution to the child’s college costs.
For example, let’s say a father is ordered to pay $150/week for child support for his 5 year old daughter. His annual child support obligation is $780o per year ($150/week for 52 weeks). He will be paying child support for a minimum of 13 years. Therefore, his basic child support obligation is $101,400 ($7800year x 13 years). Assuming that his daughter attends college he will also have a 4-year college expense obligation. Assuming further that her net college tuition and expenses are $25,00o per year and he is obligated to contribute 50% of the outstanding amount, his expected college contribution will be $12,500/year x 4 years = $50,000. He will need to have a life insurance policy for a minimum of $150,000 to cover his projected child support and college expense contribution. The obligation to carry life insurance for his child will cease at the point of his daughter’s emancipation.
A common question is whether the non-custodial parent can use the life insurance that they have through work to cover their child support obligation. The answer is yes, the insurance can generally be obtained from any source, as long as it covers the support obligation. A less frequent question is what happens in the event that the non-custodial parent cannot obtain life insurance at a reasonable price, either because of a previous or existing medical condition, or because of their health (e.g., they are smokers). This latter situation defies easy answers and will be dependent on the specific facts of the case. It should be noted that the life insurance acquired does not have to be a whole life policy. Term life insurance is widely available, and can provide hundreds of thousands of dollars of coverage at affordable rates. Continue reading →
On top of basic child support both parents have a duty to contribute to the cost of the custodial parent’s work-related childcare expenses.Work-related childcare expenses are not limited to the cost of placing a child in daycare. Work-related childcare can also include: after-school care, care provided prior to school, having a person in your house who cares for the child (e.g., a nanny), care provided during the summer months at a daycamp, or other camp.
With regards to childcare, one of the more common areas of disagreement between parents is: who decides where the child will go for childcare? One parent may be insistent on a childcare experience which includes an educational and socializing experience for the child outside of the house, whereas the other parent may not want their child left with “strangers”, and they will insist on family members taking care of the child.
Another area of disagreement is how much should be paid for daycare. The childcare provider whose program includes an educational and socializing component is usually much more expensive than the family member caregiver. As well, the parents have to figure out whether full-time or part-time care makes more sense. Continue reading →
In addition to calculating each parent’s child support obligation the cost of providing health insurance for the parties’ children has to be calculated, and allocated between the parties. There are two ways to calculate the health care premium for the children. The first is to calculate the actual marginal cost of covering the children. The second is to calculate the per capita cost of covering the children.
Actual Marginal Cost of Health Care Coverage for Children
If the parent paying for the children’s health insurance knows how much they are paying weekly to cover the children then that amount is placed on the child support worksheet as a weekly amount and allocated between the parties in proportion to the combined parental income. However, usually, the cost of providing healthcare is broken down in the following choices: Employee, Employee and Spouse, Employee and Family. To sort out how much of the total health insurance premium is solely for the children’s coverage requires the employee to subtract the amount paid to cover themselves, or themselves and their spouse alone from the cost paid to cover them and their children. The difference is the actual cost to cover the children. For example, if the employee’s cost to cover themselves and their spouse and children is $800 per month, and the cost to cover the employee and their spouse is $500, then the cost to cover the children is $300 per month. Continue reading →
Child support in New Jersey is paid on a weekly basis by the non-custodial parent (the Parent of Alternate Residence – PAR) to the custodial parent (the Parent of Primary Residence – PPR). The amount of child support to be paid is calculated by using one of two worksheets which are contained in the Appendix to the New Jersey Court Rules.
The two worksheets are: The Shared Parenting Worksheet and the Sole Parenting Worksheet.
The Shared Parenting Worksheet is used to calculate child support when the non-custodial parent has two or more overnights per week, and the parent of alternate residence can demonstrate that the child has separate living accommodations maintained specifically for the child. The Sole Parenting Worksheet is used when the non-custodial parent has less than two overnights per week. An overnight is not what we commonly understand as an overnight (night into morning period). An overnight for child support purposes is “more than 12 hours” or the majority of a 24-hour day.
The amount of child support paid by the non-custodial parent is inversely proportional to the number of overnights that the non-custodial parent has with the child. Stated simply, the more overnights that the non-custodial parent has with the child, the less child support that they pay to the custodial parent. The fewer overnights that the no-custodial parent has with the child the more child support that they have to pay the custodial parent. Continue reading →
A divorce or separation rarely starts off in a clean, orderly fashion. Once the relationship begins to deteriorate there is often a messy period where the parties rights and options are sorted out. Who stays and who goes, and on what timeline? Who pays for what expenses? Who keeps what? These are the basic questions that have to be answered.
The law in this area is straightforward. The parties are supposed to maintain the financial status quo as their case progresses and they attempt to settle their issues.
One of the biggest questions to be resolved is how are the housing expenses shared during the break up. Generally speaking, if you were contributing 25% of the mortgage or rent expense on a monthly basis before the separation or divorce began, you will be responsible to continue to contribute 25% during the separation or divorce process. Unless the parties agree, one party cannot move out and say to the other party, “I’ve got my own rent and utilities now, so you’re on your own to figure out how you pay your housing expenses.” Even though you are in the middle of a break up, housing expenses have to be paid as they were before the break up. Practically speaking this is a tough position to be in for the person moving out of the home.
For example, let’s say husband moves out of the house during the divorce and does not return. When he goes out and tries to rent an apartment he has to come up with the security deposit, first month’s rent, and broker fee. Then he has moving expenses. Assuming that he settles into an apartment he has rent, utilities, and all of his other individual bills to pay. However, according to the law he still has to contribute his portion to the housing expenses at the home where wife is residing. Unless his cash flow situation is very favorable he will be stretched to the financial breaking point as he is paying a housing expense at two separate residences. Unfortunately for him the courts generally hold him responsible to contribute to his marital expenses ahead of his own personal living expenses. Continue reading →