Skylark.law
We received the following question as an Anonymous Comment on our previous post: Alimony Reform and Child Support: What will Change?
How will you calculate child support in a case where the dependent spouse does not have physical custody and the incomes of the parties are grossly disparate?
With the new Alimony Reform in Massachusetts taking effect on March 1, 2012, we have been hearing this question a lot. Although it is an unusual situation to have the custodial parent also be the higher earning spouse, it does happen.
Under the new Alimony statute:
While this could mean less overall support for cases where the custodial parent is also the lower wage-earner, the impact is even more significant when the non-custodial parent is the lower wage-earner. While the non-custodial parent who earns less gets a break on child support, it seems unfair to say they never qualify for alimony if the total gross income of the parties is less than $250,000.
For example, consider the following sample case:
Mom has been the primary care parent and is a doctor who owns her own practice and has reasonable control over her hours and earns $200,000 per year. Dad is a CNA who works odd hours and therefore has not spent as much time with the children. He earns $35,000 per year. The parties have been married for 15 years and have two children, ages 4 and 5.
The Massachusetts Child Support Guidelines will require that Dad pay Mom $94 per week in child support (approx. 14% of his income).
Since all of Mom and all of Dad's income were used in calculating child support a pure reading of the statute leaves nothing left to calculate alimony. However, if there were no children this would clearly be an alimony case. One argument in favor of this reading is that Mom who is the custodial parent in this case will be able to provide a better household for the children based on her higher income and no alimony. The counter to that argument, though, is that keeping the Dad from having a similar lifestyle could damage his ability to spend time with the children and their desire to spend time at Dad's house, thereby encouraging Dad to be less involved rather than more involved in the children's lives.
It is unknown at this point how the trial courts and the appeals court will read this section. Many practitioners that we have spoken to believe Judges will look to find a way around this "unfair" result, and use deviation factors to allow them to award alimony to the lower-earning spouse in a case like this (or at least reduce or eliminate child support).
The problem with these cases is that they are often not as clear cut as the example above, and often will involve prejudicial judgments made about the low-earning father or the non-custodial mother (i.e. assuming something is wrong with them). Until the Appeals Court or SJC rules on this type of case we won't know for sure how this case will be dealt with, and we expect that the lower courts will vary in their application of the statute to these types of cases.
How will you calculate child support in a case where the dependent spouse does not have physical custody and the incomes of the parties are grossly disparate?
With the new Alimony Reform in Massachusetts taking effect on March 1, 2012, we have been hearing this question a lot. Although it is an unusual situation to have the custodial parent also be the higher earning spouse, it does happen.
Under the new Alimony statute:
"For purposes of setting an alimony order, the court shall exclude from its income calculation:
(1) Capital gain income and dividend and interest income which derives from assets equitably divided between the parties under Section 34; and
(2) Gross income which the court has already considered for setting a child support order whether pursuant to the Massachusetts Child Support Guidelines or otherwise; provided that nothing in this section shall limit the court’s discretion to cast a presumptive child support order under the Child Support Guidelines in terms of unallocated or undifferentiated alimony and child support."Since the Massachusetts Child Support Guidelines presumptively apply up to a total gross income of $250,000, this section means that cases where the total gross income does not exceed $250,000 there won't be any income leftover to calculate alimony (absent some deviation factor).
While this could mean less overall support for cases where the custodial parent is also the lower wage-earner, the impact is even more significant when the non-custodial parent is the lower wage-earner. While the non-custodial parent who earns less gets a break on child support, it seems unfair to say they never qualify for alimony if the total gross income of the parties is less than $250,000.
For example, consider the following sample case:
Mom has been the primary care parent and is a doctor who owns her own practice and has reasonable control over her hours and earns $200,000 per year. Dad is a CNA who works odd hours and therefore has not spent as much time with the children. He earns $35,000 per year. The parties have been married for 15 years and have two children, ages 4 and 5.
The Massachusetts Child Support Guidelines will require that Dad pay Mom $94 per week in child support (approx. 14% of his income).
Since all of Mom and all of Dad's income were used in calculating child support a pure reading of the statute leaves nothing left to calculate alimony. However, if there were no children this would clearly be an alimony case. One argument in favor of this reading is that Mom who is the custodial parent in this case will be able to provide a better household for the children based on her higher income and no alimony. The counter to that argument, though, is that keeping the Dad from having a similar lifestyle could damage his ability to spend time with the children and their desire to spend time at Dad's house, thereby encouraging Dad to be less involved rather than more involved in the children's lives.
It is unknown at this point how the trial courts and the appeals court will read this section. Many practitioners that we have spoken to believe Judges will look to find a way around this "unfair" result, and use deviation factors to allow them to award alimony to the lower-earning spouse in a case like this (or at least reduce or eliminate child support).
The problem with these cases is that they are often not as clear cut as the example above, and often will involve prejudicial judgments made about the low-earning father or the non-custodial mother (i.e. assuming something is wrong with them). Until the Appeals Court or SJC rules on this type of case we won't know for sure how this case will be dealt with, and we expect that the lower courts will vary in their application of the statute to these types of cases.
What about not using all of mom's income is used for child support? Child support from dad using half of her income will result in approximately the same child support and leave some of mom's income available or alimony. Creativity will be needed as dad's income will increase from the alimony and impact the chld support amount and there will be tax implications as well. Working the numbers in a variety of ways will find an equitable result for dad.
ReplyDeleteAnonymous: Thank you for your comment. There are a lot of possible different ways to approach this problem to arrive at different possible child support and alimony figures. The problem is that the new statute seems on its face to indicate that child support should be calculated first. Whether a trial judge (or the appeals court) will accept the type of creative thinking you are suggesting remains to be seen.
ReplyDeleteI am extremely grateful you have posted on this topic. It is the first time I have seen this scenario discussed.
ReplyDeleteIs there any update on how the courts have been ruling on this situation? In my specific case, my wife has been a stay at home mother for 12 years and is leaving the children in my custody. I have been going on the assumption that at least some rehabilitative alimony is warranted in order to maintain a reasonably equitable quality of life.
Thank you for your comment.
DeleteI am not aware of any appeals ruling on this issue yet, but what I have been hearing at seminars is that trial Judges are finding ways around the $250,000 cap. There are deviation factors which could allow a Judge to do this, if those factors apply. Or as you have pointed out, Rehabilitative Alimony might be an option because only General Term Alimony has a formula which includes the child support language. Since Rehabilitative alimony has a 5 year limit, and General Term alimony in a 12 year marriage could last as long as 8.4 years, there might need to be some compromise here, but it seems like there are numerous factors that make this an excellent case for alternative dispute resolution (i.e. mediation or collaborative divorce).